Investor Insight: Fomento Economico Mexicano Hits Oversold Levels
Warren Buffett’s Wisdom and the RSI Indicator
Legendary investor Warren Buffett once said to be fearful when others are greedy, and to be greedy when others are fearful. One method for gauging fear in the stock market is the Relative Strength Index (RSI). This technical analysis tool measures momentum on a scale ranging from zero to 100, where a stock is deemed oversold if the RSI falls below 30.
On Wednesday, shares of Fomento Economico Mexicano, S.A.B. de C.V. (Symbol: FMX) entered oversold territory, reaching an RSI of 29.5 after trading as low as $91.905 per share. In contrast, the current RSI of the S&P 500 ETF (SPY) stands at 66.2. For bullish investors, FMX’s low RSI could indicate that the recent selling is slowing down, prompting a look for buying opportunities. Below is a chart illustrating the one-year performance of FMX shares:
According to the chart, FMX’s 52-week low is $91.905 per share, while the high is $143.43. The last trade price was $92.06.
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The views and opinions expressed herein are those of the author and do not necessarily reflect the views of Nasdaq, Inc.
