TMX Group Is Now Oversold (X.CA)

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 TMX Group (TSX: X.TO) entered into oversold territory, hitting an RSI reading of 26.5, after changing hands as low as $42.655 per share. By comparison, the current RSI reading of the S&P/TSX Composite Index is 59.9. A bullish investor could look at X's 26.5 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 X shares:

START SLIDESHOW:
Click here to find out which 9 other oversold Canadian stocks you need to know about »

TMX Group 1 Year Performance Chart

Looking at the chart above, X's low point in its 52 week range is $42.50 per share, with $57.82 as the 52 week high point — that compares with a last trade of $43.15.
Three Months Free, a $100 Value, Just Submit Your Top Stock Pick! (Offer ends 11/10/2013)

null

More from Stocks

Quick Read: 3 Things for Investors to Know Before Wednesday's Trading Session

Quick Read: 3 Things for Investors to Know Before Wednesday's Trading Session

Replay: Jim Cramer on the Markets, Oil, General Electric, Zillow and Micron

Replay: Jim Cramer on the Markets, Oil, General Electric, Zillow and Micron

Pegasystems Founder Explains Why He Has One of the Hottest Tech Stocks Around

Pegasystems Founder Explains Why He Has One of the Hottest Tech Stocks Around

Micron Shares Soar; Chipmaker Is 'Managing for Profitability' Now, Says Analyst

Micron Shares Soar; Chipmaker Is 'Managing for Profitability' Now, Says Analyst

Dow Slips 178 Points; S&P 500 and Nasdaq Also Decline

Dow Slips 178 Points; S&P 500 and Nasdaq Also Decline