Investors following shares of Ultrashort QQQ Proshares (QID) may have seen that the stock has slid -8.66% over the last 4 weeks. Looking out over the last half-year, shares have seen a change of -39.77%. Watching performance over the past 52-weeks, shares have moved -20.29%. Over the last 5 trading periods, shares have moved 0.50%.
Investors might be looking into the magic eight ball trying to project where the stock market will be heading over the next few months. Some analysts believe that the market is ready to take a bearish turn, but others believe that there is still room for stocks to shoot higher. When the markets do have a sell-off, investors may be tempted to sell winners before they give up previous profits. Sometimes this may be justified, but other times this type of panic selling can cause investors to just have to repurchase shares at a higher price after the recovery. Keeping tabs on the underlying company fundamental data can help provide the investor with a better idea of whether to hold on to a stock or let it go.
The RSI, or Relative Strength Index, is a commonly used technical momentum indicator that compares price movement over time. The RSI was created by J. Welles Wilder who was striving to measure whether or not a stock was overbought or oversold. The RSI may be useful for spotting abnormal price activity and volatility. The RSI oscillates on a scale from 0 to 100. The normal reading of a stock will fall in the range of 30 to 70. A reading over 70 would indicate that the stock is overbought, and possibly overvalued. A reading under 30 may indicate that the stock is oversold, and possibly undervalued. After a recent check, the 14-day RSI is currently at 42.94, the 7-day stands at 43.16, and the 3-day is sitting at 68.80.
Investors may be watching other technical indicators such as the Williams Percent Range or Williams %R. The Williams %R is a momentum indicator that helps measure oversold and overbought levels. This indicator compares the closing price of a stock in relation to the highs and lows over a certain time period. A common look back period is 14 days. Ultrashort QQQ Proshares (QID)’s Williams %R presently stands at -75.24. The Williams %R oscillates in a range from 0 to -100. A reading between 0 and -20 would indicate an overbought situation. A reading from -80 to -100 would indicate an oversold situation.
Taking a peek at some Moving Averages, the 200-day is at 38.09, the 50-day is 32.91, and the 7-day is sitting at 31.63. The moving average is a popular tool among technical stock analysts. Moving averages are considered to be lagging indicators that simply take the average price of a stock over a specific period of time. Moving averages can be very useful for identifying peaks and troughs. They may also be used to help the trader figure out proper support and resistance levels for the stock.
The Average Directional Index or ADX is a popular technical indicator designed to help measure trend strength. Many traders will use the ADX in combination with other indicators in order to help formulate trading strategies. Presently, the 14-day ADX for Ultrashort QQQ Proshares (QID) is 21.51. In general, an ADX value from 0-25 would indicate an absent or weak trend. A value of 25-50 would indicate a strong trend. A value of 50-75 would signal a very strong trend, and a value of 75-100 would indicate an extremely strong trend. The ADX alone was designed to measure trend strength. When combined with the Plus Directional Indicator (+DI) and Minus Directional Indicator (-DI), it can help decipher the trend direction as well.
Traders may be relying in part on technical stock analysis. Ultrashort QQQ Proshares (QID) currently has a 14-day Commodity Channel Index (CCI) of -59.09. Despite the name, CCI can be used on other investment tools such as stocks. The CCI was designed to typically stay within the reading of -100 to +100. Traders may use the indicator to determine stock trends or to identify overbought/oversold conditions. A CCI reading above +100 would imply that the stock is overbought and possibly ready for a correction. On the other hand, a reading of -100 would imply that the stock is oversold and possibly set for a rally.
Once the individual investor has done all the fundamental homework and found a few stocks that they think are poised to be future winners, they may want to figure out when to best get into the market. Many investors will turn towards technical analysis to accomplish this. Technical analysis can help identify entry and exit points by studying price trends and movements over time. Some technical indicators are very complex and others are very simple. One goal of focusing on technical indicators is to help make confusing price information easier to interpret and understand. Many investors will find signals that they like to follow, but focusing on just one indicator may not provide the full picture of what is really going on. Many investors will combine technical indicators to help round out the spectrum. Although technical analysis can be a very useful tool for the investor, it is important to remember that stock prices are inherently unpredictable. Even the most seasoned investors may have to adjust their charts occasionally if trades are not working out as planned.
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