In the Friday trading, shares held by Tallgrass Energy GP (TEGP) LP were seen to be in the oversold territory. This saw the shares being sold for as low as $23.12 each, reflecting the fact that TEGP stock is crowded with sellers. The oversold territory here is defined using the Relative Strength Index (RSI).
The Relative Strength Index (RSI) of a security is an analysis indicator used to calculate the value of the security based on its average gains and losses over a period of time. It is measured on a scale of 0 to 100. The closer the average RSI is to 100, the more it indicates that the average gains surpasses the average losses over the calculated period of time. In the same vein, the closer the average RSI value is to zero, the more it indicates that average losses exceed average gains over the same calculated period. If a security experiences a downward trend for a long period, then the RSI reflects this in a progression towards zero. In general, when the average RSI level is lower than 30, the security is regarded as being in oversold territory and predictably, an RSI value that is higher than 70 indicates overbought stock. The RSI is used as an analysis indicator technically.
Shares belonging to Tallgrass Energy GP LP were at an RSI average reading of 28.1. A look at other stocks will enable a comparison. The entirety of energy stocks on the Energy Stock Channel had an average RSI reading of 48.6, WTI crude oil energy stocks has an average RSI reading of 66.1 and the Henry Hub Natural Gas average RSI reading currently stands at 56.3. 3-2-1 Crack Spread average RSI reading also stands at 44.4. TEGP RSI reading compares to all the above stated average RSI readings with a value of 28.1. A bullish investor that is interested in TEGP stock could regard TEGP’s low average RSI reading of 28.1 as a sign that TEGP selling is about to hit rock bottom and view it as an opportunity to gain entry into TEGP stocks by buying at this price.
An analysis of the one year performance of TEGP as shown in the chart depict TEGP with a 52-week low point at $21.87 per share while its 52-week high point hit $29.50 per share. This is comparable with the last trade that was at $23.26. Tallgrass Energy GP LP shares trades off at about 2.2% currently on the day. The ETF Finder at ETF Channel stipulates that 4.12% of the High Income Infrastructure MLP ETF is made up by TEGP which was also seen to trade at a reduced rate of 0.1% on Friday.