SPDR Wells Fargo Preferred Stock (PSK) Enters Oversold Territory

In trading on Monday, shares of the SPDR Wells Fargo Preferred Stock ETF (PSK) entered into oversold territory, changing hands as low as $41.81 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 SPDR Wells Fargo Preferred Stock, the RSI reading has hit 26.4 — by comparison, the RSI reading for the S&P 500 is currently 38.1.

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A bullish investor could look at PSK's 26.4 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), PSK's low point in its 52 week range is $41.81 per share, with $46.63 as the 52 week high point — that compares with a last trade of $42.36. SPDR Wells Fargo Preferred Stock shares are currently trading off about 1.4% on the day.

SPDR Wells Fargo Preferred Stock 1 Year Performance Chart

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