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 Wednesday, shares of Northwest Pipe Co. ( NWPX - Get Report) entered into oversold territory, hitting an RSI reading of 27.8, after changing hands as low as $21.05 per share. By comparison, the current RSI reading of the S&P 500 ETF (SPY) is 39.4. A bullish investor could look at NWPX's 27.8 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 NWPX shares: Looking at the chart above, NWPX's low point in its 52 week range is $21.05 per share, with $41.43 as the 52 week high point — that compares with a last trade of $21.05. According to the ETF Finder at ETF Channel, NWPX makes up 2.90% of the First Trust ISE Water Index Fund ETF ( FIW) which is trading lower by about 0.5% on the day Wednesday.
More from Stocks
Facebook, Twitter Crack Down on Targeting of Hong Kong Protesters
Facebook removed pages, groups and accounts that it contends were "involved in coordinated inauthentic behavior" by a "small network" in China aimed at stirring anger against the protesters in Hong Kong.
Huawei-Related Stocks Gain on License Extension From Trump Administration
Gainers lead losers among stocks with significant business with Huawei after the Commerce Department grants China tech giant a license extension to buy U.S. parts.
Three Retail Earnings Reports to Watch (Hint: Consumers Are Still Spending)
The consumer is still hot. Are these three retail stocks about to get hot, too?