CGDG Crosses Critical Technical Indicator

In trading on Wednesday, shares of the Capital Group Dividend Growers ETF (Symbol: CGDG) entered into oversold territory, changing hands as low as $37.11 per share. We define oversold territory using the Relative Strength Index, or RSI, which is a technical analysis indicator used to measure momentum on a scale of zero to 100. A stock is considered to be oversold if the RSI reading falls below 30. In the case of Capital Group Dividend Growers, the RSI reading has hit 28.1 — by comparison, the RSI reading for the S&P 500 is currently 49.2. A bullish investor could look at CGDG's 28.1 reading as a sign that the recent heavy selling is in the process of exhausting itself, and begin to look for entry point opportunities on the buy side.