Warren Buffett’s Wisdom: What Oversold Stocks Like LivaNova PLC Can Teach Us
Understanding the stock market’s mood through the Relative Strength Index (RSI)
Legendary investor Warren Buffett famously advises being fearful when others are greedy, and greedy when others are fearful. One way to gauge fear in a stock is by using the Relative Strength Index (RSI), a technical analysis tool that measures momentum on a scale from zero to 100. When an RSI reading drops below 30, it suggests that a stock is oversold.
On Monday, LivaNova PLC (Symbol: LIVN) entered this oversold territory, recording an RSI of 29.7 after trading as low as $48.72 per share. In contrast, the current RSI for the S&P 500 ETF (SPY) stands at 40.9. For bullish investors, LIVN’s RSI reading of 29.7 might indicate that the recent heavy selling is nearing its end, signaling potential buying opportunities. The chart below illustrates LIVN’s performance over the past year:
As shown in the chart, LIVN’s 52-week low is $42.75, while its high reaches $64.475. The last trade price was $49.01, indicating it is currently nearer the low end of this range.
Discover nine other oversold stocks worth considering »
Additional Resources:
- Top Stocks Held by Carl Icahn
- MPME Options Chain
- LAMR Market Cap History
The views and opinions expressed herein are those of the author and do not necessarily reflect the views of Nasdaq, Inc.
