In trading on Monday, shares of the Simplify Managed Futures Strategy ETF (Symbol: CTA) entered into oversold territory, changing hands as low as $27.60 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 Simplify Managed Futures Strategy, the RSI reading has hit 27.9 — by comparison, the RSI reading for the S&P 500 is currently 61.5.
A bullish investor could look at CTA’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), CTA’s low point in its 52 week range is $26.36 per share, with $32.76 as the 52 week high point — that compares with a last trade of $27.87. Simplify Managed Futures Strategy shares are currently trading down about 1.5% on the day.
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Further CTA Research:
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