FXZ Crosses Critical Technical Indicator

In trading on Tuesday, shares of the First Trust Materials AlphaDEX Fund ETF (FXZ) entered into oversold territory, changing hands as low as $31.98 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 First Trust Materials AlphaDEX Fund, the RSI reading has hit 28.8 — by comparison, the RSI reading for the S&P 500 is currently 48.3.

START SLIDESHOW:
Find out what 9 other oversold stocks you need to know about »

A bullish investor could look at FXZ's 28.8 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), FXZ's low point in its 52 week range is $28.38 per share, with $34.52 as the 52 week high point — that compares with a last trade of $32.09. First Trust Materials AlphaDEX Fund shares are currently trading off about 1.1% on the day.

First Trust Materials AlphaDEX Fund 1 Year Performance Chart

More from Stocks

Dow Ends Sharply Lower Led by Apple and Goldman as Trade War Fears Grow

Dow Ends Sharply Lower Led by Apple and Goldman as Trade War Fears Grow

Must-Know Levels in Nvidia Stock Ahead of Earnings

Must-Know Levels in Nvidia Stock Ahead of Earnings

Chart of the Day: Home Depot and Lowe's Go Head to Head in Home Improvement

Chart of the Day: Home Depot and Lowe's Go Head to Head in Home Improvement

R.R. Donnelley Stock Is Ready to Change Direction

R.R. Donnelley Stock Is Ready to Change Direction

Marvel Comics Co-Creator Stan Lee Has Died at 95

Marvel Comics Co-Creator Stan Lee Has Died at 95