Sector Trading Range Charts

Ted

FYI: Below is our trading range chart for the S&P 500. The white line represents its 50-day moving average, while the light blue shading represents between one standard deviation above and below the 50-day moving average. This light blue shading represents the index’s trading range. The red and green shadings represent between one and two standard deviations above and below the 50-day. The red area is “overbought” territory, while the green area is “oversold” territory.
Regards,
Ted
https://www.bespokepremium.com/think-big-blog/sector-trading-range-charts/

VintageFreak

I'm sorry, but I'm not sure how these charts helps one to invest. For instance, I see a lot of charts where security is getting oversold, then keeps going down and is still oversold. I take it oversold might suggest consideration to buy and conversely for overbought. By themselves, I'm not seeing how this helps. It is not even interesting information, since chart's RSI gives the same information.

What am I missing?

Ted

@VintageFreak: Sector Funds !
Regards,
Ted
http://www.investopedia.com/articles/mutualfund/08/sector-fund-introduction.asp