AT&T Has Moved into Oversold Territory

oversold

Out of all of the advice that Warren Buffett has given, the following might be the most important: Be fearful when others are greedy, and be greedy when others are fearful. When trying to measure the level of fear in a certain stock, look at the technical analysis indicator called the Relative Strength Index (RSI), which measures momentum on a 0 to 100 scale. If, for instance, the RSI reading falls below 30, that stock is thought to be oversold.

oversold

In trading on July 18, AT&T (NYSE:$T) shares entered into oversold territory, reaching an RSI reading of 29.7, after changing hands as low as $35.87 per share. To put that into perspective, the RSI reading of the S&P 500 ETF is 62.7.

In the mind of a bullish investor, the 29.7 RSI reading on Tuesday could be seen as a sign that the recent heavy selling is on the verge of exhausting itself, and might be an inkling to look for entry point opportunities on the buy side. Below is a chart that shows the one year performance of T shares:

When looking at the chart, we can see that AT&T’s low point in its 52 week range is $35.87 per share, with $43.50 as the 52 week high point.

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About the author: Caroline Harris is a third-year student at Capilano University in North Vancouver, Canada. Having already completed an Associates Degree in Psychology, Caroline is now finishing her Bachelor's degree in Communications. In preparation for working in the advertisement sector, Caroline is writing financial content and analysis. On a daily basis, Caroline works on articles regarding the following topics: finance, cryptocurrency, technology, and politics.