In trading on Wednesday, shares of the iShares FTSE China ETF (FCHI) entered into oversold territory, changing hands as low as $43.5074 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 iShares FTSE China, the RSI reading has hit 29.2 — by comparison, the RSI reading for the S&P 500 is currently 46.8.

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A bullish investor could look at FCHI's 29.2 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), FCHI's low point in its 52 week range is $39.71 per share, with $51.53 as the 52 week high point — that compares with a last trade of $43.51. iShares FTSE China shares are currently trading down about 1.1% on the day.

iShares FTSE China 1 Year Performance Chart