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 Idenix Pharmaceuticals Inc ( IDIX) entered into oversold territory, hitting an RSI reading of 29.7, after changing hands as low as $5.009 per share. By comparison, the current RSI reading of the S&P 500 ETF (SPY) is 54.0. A bullish investor could look at IDIX'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 IDIX shares: Looking at the chart above, IDIX's low point in its 52 week range is $2.93 per share, with $9.32 as the 52 week high point — that compares with a last trade of $5.17. According to the ETF Finder at ETF Channel, IDIX makes up 1.09% of the SPDR S&P Biotech ETF ( XBI) which is trading lower by about 4% on the day Friday.
More from Stocks
Boeing Inks $3.6 Billion 737 MAX 8 Order with Air Astana at Dubai Air Show
Boeing said Tuesday that it has booked $3.6 billion in new orders for its 737 MAX jet at the Dubai Airshow as the world's biggest planemaker continues to estimate a potential December return for the grounded aircraft.
Dow Futures Rise, Global Stocks Gain Amid Mixed US-China Trade Talk Signals
Wall Street futures edged higher again Tuesday, following a mixed session in Asia and modest gains across Europe, amid conflicting signals for a near-term U.S.-China trade agreement an ongoing political protests in Hong Kong.