Shares of AFK Now Oversold

In trading on Friday, shares of the Africa Index ETF (AFK) entered into oversold territory, changing hands as low as $27.27 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 Africa Index, the RSI reading has hit 28.7 — by comparison, the RSI reading for the S&P 500 is currently 77.1.

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A bullish investor could look at AFK's 28.7 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), AFK's low point in its 52 week range is $27.27 per share, with $34.50 as the 52 week high point — that compares with a last trade of $27.29. Africa Index shares are currently trading down about 0.8% on the day.

Africa Index 1 Year Performance Chart

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