UDN Crowded With Sellers

In trading on Friday, shares of the PowerShares DB US Dollar Index Bearish Fund ETF ( UDN) entered into oversold territory, changing hands as low as $25.51 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 PowerShares DB US Dollar Index Bearish Fund, the RSI reading has hit 27.3 — by comparison, the RSI reading for the S&P 500 is currently 67.5.

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A bullish investor could look at UDN's 27.3 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), UDN's low point in its 52 week range is $25.47 per share, with $27.44 as the 52 week high point — that compares with a last trade of $25.51. PowerShares DB US Dollar Index Bearish Fund shares are currently trading down about 0.4% on the day.

PowerShares DB US Dollar Index Bearish Fund 1 Year Performance Chart

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