How Oversold Are We And What Does It Mean
- Posted by Frank Zorrilla
- on August 20th, 2013
Here are some stats that will tell you how oversold we are. Normally when we are this oversold we tend to have decent 1-5 day bounces, and every now and then you get a big washout, but that is a low probability event.
Telechart McClellan Oscillator -279
Stocks above their 10 day moving average in the Russell 3k = 11%
Stocks above their 10 day moving average in the major ETF’S;
- $SPY 4.63% RSI2 .81
- $QQQ 9.58% RSI2 6.50
- $IWM 12.5% RSI2 1.18
- $XLB 7.69% RSI2 3.08
- $XLP 6.66% RSI2 .73
- $XLY 6.25% RSI2 .51
- $XLE 8% RSI2 .81
- $XLF 0% RSI2 1.79
- $XLV 0% RSI2 20.86
- $HGX 5.88% RSI2 12.86
- $XLI 4.54% RSI2 10.12
- $SMH 6.66% RSI2 13.38
- $XLK 9.25% RSI2 7.81
These low percent levels tend to lead to bounces so adjust your plan accordingly; maybe you wait for a bounce to sell some stocks, maybe you don’t short in the hole, or perhaps you do nothing and realize this might be the beginning of something bigger that is not worth playing.
below the backtest performance summary of ”$SPY closes at 20 day low on a Monday“ since 2000
The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.
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Frank Zorrilla is the founder and chief investment officer of Zor Capital LLC.He began his Wall Street career 10 days after his 20th birthday when he became a Series 7 licensed stock broker. More »
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