In trading on Wednesday, shares of the Invesco DB Oil Fund ETF (Symbol: DBO) entered into oversold territory, changing hands as low as $17.48 per share. We define oversold territory using the Relative Strength Index, or RSI, which is a technical analysis indicator used to measure momentum on a scale of zero to 100. A stock is considered to be oversold if the RSI reading falls below 30.
In the case of Invesco DB Oil Fund, the RSI reading has hit 27.9 — by comparison, the RSI reading for the S&P 500 is currently 45.2.
A bullish investor could look at DBO’s 27.9 reading as a sign that the recent heavy selling is in the process of exhausting itself, and begin to look for entry point opportunities on the buy side.
Looking at a chart of one year performance (below), DBO’s low point in its 52 week range is $11.885 per share, with $23.98 as the 52 week high point — that compares with a last trade of $17.58. Invesco DB Oil Fund shares are currently trading off about 4% on the day.
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Further DBO Research:
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