FEZ’s moving average
On November 17, 68% of the portfolio holdings of the SPDR Euro STOXX 50 ETF (FEZ) closed above their 100-day moving averages, up from 46% on November 16. Furthermore, 83% of the portfolio holdings closed above their 50-day moving averages, up from 52% the day prior, and 71% of the portfolio holdings closed above their 20-day moving averages, up from 60% on November 16. This change in the portfolio holdings indicates that most holdings were moving towards an uptrend by maintaining these moving averages as strong support points.
France-based integrated oil and gas company Total (TOT) was 6.8% above the 100-day moving average, 7% above the 50-day moving average, and 2.9% above the 20-day moving average. Total constitutes 8.2% of the portfolio holdings in the iShares MSCI France ETF (EWQ). The moving average is a trend-following indicator. It’s also known as a lagging indicator because it’s calculated based on past price performance.
The graph above shows the percentage of FEZ’s portfolio holdings that were above their 100-day, 50-day, and 20-day moving averages. The graph also shows a relative strength index analysis.
FEZ’s relative strength index
90% of FEZ’s portfolio holdings were in the 30–70 RSI (relative strength index) range on November 17, compared with 93% on November 16. It indicates there were minor changes in the neither overbought nor oversold area.
6% of FEZ’s portfolio holdings had an RSI of above 70 and 4% of FEZ’s portfolio holdings had an RSI of below 30. RSI is a technical indicator used to determine the overbought or oversold status of a stock. If the RSI is above 70, it indicates that a stock is overbought. If the RSI is below 30, it indicates that a stock is oversold.
FEZ’s large capitalization holdings Anheuser-Busch (BUD) and SAP (SAP) were in the overbought area. Siemens (SIEGY) and Banco Santander (SAN) were neither overbought nor oversold. In the next part of this series, we’ll analyze FEZ and its top performers with respect to volatility and mean return.