Monolithic Power Systems Getting Very Oversold (MPWR)

Legendary investor Warren Buffett advises to be fearful when others are greedy, and be greedy when others are fearful. One way we can try to measure the level of fear in a given stock is through a technical analysis indicator called the Relative Strength Index, or RSI, which measures momentum on a scale of zero to 100. A stock is considered to be oversold if the RSI reading falls below 30.

In trading on Friday, shares of Monolithic Power Systems Inc ( MPWR) entered into oversold territory, hitting an RSI reading of 29.7, after changing hands as low as $20.64 per share. By comparison, the current RSI reading of the S&P 500 ETF (SPY) is 49.5. A bullish investor could look at MPWR's 29.7 RSI reading today 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. The chart below shows the one year performance of MPWR shares:

START SLIDESHOW:
Find out what 9 other oversold stocks you need to know about »

Monolithic Power Systems Inc 1 Year Performance Chart

Looking at the chart above, MPWR's low point in its 52 week range is $17.07 per share, with $25.66 as the 52 week high point — that compares with a last trade of $20.99.

According to the ETF Finder at ETF Channel, MPWR makes up 1.68% of the SPDR S&P Semiconductor ETF ( XSD) which is trading lower by about 0.3% on the day Friday.
null

If you liked this article you might like

Intersil Buyout Highlights Chipmaker Consolidation; Here's Who Could Be Next

Intersil Buyout Highlights Chipmaker Consolidation; Here's Who Could Be Next

Insider Trading Alert - MPWR, COP And UTEK Traded By Insiders

Insider Trading Alert - MPWR, COP And UTEK Traded By Insiders

New Lifetime High For Monolithic Power Systems (MPWR)

New Lifetime High For Monolithic Power Systems (MPWR)

Market's Got a Brand New (Mixed) Bag

Market's Got a Brand New (Mixed) Bag

New Lifetime High Reached By Monolithic Power Systems (MPWR)

New Lifetime High Reached By Monolithic Power Systems (MPWR)