In a recent post about TAG Oil as a good “buy” opportunity, Forbes online says “…investor Warren Buffett advises to be fearful when others are greedy, and be greedy when others are fearful.” They point towards one way of measuring fear levels via the Relative Strength Index (RSI), which measures stock momentum on a 100-point scale.
“A stock is considered to be oversold if the RSI reading falls below 30. A bullish investor could look at TAO’s 28.8 RSI reading today 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….”
Indeed. Since we can’t control a volatile global stock market, we can at least appreciate these opportunities when they come. See the full Forbes story here.