Pharmaceutical (PPH) Enters Oversold Territory

In trading on Tuesday, shares of the Pharmaceutical ETF (PPH) entered into oversold territory, changing hands as low as $51.13 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 Pharmaceutical, the RSI reading has hit 29.7 — by comparison, the RSI reading for the S&P 500 is currently 48.8.

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A bullish investor could look at PPH's 29.7 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), PPH's low point in its 52 week range is $50.64 per share, with $62.22 as the 52 week high point — that compares with a last trade of $51.35. Pharmaceutical shares are currently trading down about 1.4% on the day.

Pharmaceutical 1 Year Performance Chart

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