MCP Stock Crowded With Sellers

In trading on Thursday, shares of Molycorp Inc. (MCP) entered into oversold territory, changing hands as low as $3.86 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 Molycorp Inc. , the RSI reading has hit 21.3 — by comparison, the universe of metals and mining stocks covered by Metals Channel currently has an average RSI of 44.8, the RSI of Spot Gold is at 42.3, and the RSI of Spot Silver is presently 39.5.

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

A bullish investor could look at MCP's 21.3 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), MCP's low point in its 52 week range is $3.86 per share, with $8.06 as the 52 week high point — that compares with a last trade of $3.94. Molycorp Inc. shares are currently trading off about 13.3% on the day.

Molycorp Inc.  1 Year Performance Chart

According to the ETF Finder at ETF Channel, MCP makes up 4.19% of the Rare Earth/Strategic Metals ETF ( REMX) which is trading lower by about 1.3% on the day Thursday.

More from Stocks

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

9 Stocks Goldman Sachs Thinks Will Blow Wall Street's Performance Away in 2019

9 Stocks Goldman Sachs Thinks Will Blow Wall Street's Performance Away in 2019

Jim Cramer on U.S.-China Trade: The Media Has it Wrong

Jim Cramer on U.S.-China Trade: The Media Has it Wrong

Is Tesla's Stock Set to Nearly Double to $500?

Is Tesla's Stock Set to Nearly Double to $500?

Tesla's $78,000 Model 3 Is a Bargain. Here's Why

Tesla's $78,000 Model 3 Is a Bargain. Here's Why