How Oversold Are We And What Does It Mean

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.

Via @PastStat; below the backtest performance summary of  ”$SPY closes below the lower Bollinger band for three or more days in row“ since 2000

below the backtest performance summary of  ”$SPY closes at 20 day low on a Monday“ since 2000

Source: PastStat.com


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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