Economy

First Trust Senior Floating Rate Income Fund II (FCT): Tracking the Indicators

Bull markets are times when investors may be willing to take some liberties with stock picks. At some point along the way, many investors may have had to make some tough decisions. Investors who are able to quickly learn from previous mistakes may be much better situated if they are able to keep from repeating those mistakes.

Investors and traders using technical analysis to examine stocks may be interested in taking a look at the ATR or Average True Range in addition to the Balance Step.

Monitoring the signals for Alcentra European Floating Rate Income Fund Ltd (AEFS.L), we have seen that the Percentage Price Oscillator is now lower than the signal line. Investors and traders may use this indicator to help spot price reversals, price extremes, and the strength of a trend. The RSI was developed by J. Welles Wilder. Wilder has developed multiple indicators that are still quite popular in today's investing landscape. The general interpretation of the ATR is the higher the ATR value, the higher the volatility.

The Williams Percent Range or Williams %R is another technical indicator worth checking out. At the time of writing, the 14-day ADX for NB Global Floating Rate Income Fund Ltd (NBLS.L) is 17.50. The Williams %R is a momentum indicator that helps measure oversold and overbought levels. Gulf Industrials Ltd (GLF.AX)'s Williams %R presently stands at -100.00. The RSI is considered to be an internal strength indicator, not to be confused with relative strength which is compared to other stocks and indices. Alternately, if the indicator goes under -80, this may show the stock as being oversold. Traders often add the Plus Directional Indicator (+DI) and Minus Directional Indicator (-DI) to identify the direction of a trend. Investors are a little more bearish on BlackRock Floating Rate Income if you pay attention to the change in short interest. In general, an ADX value from 0-25 would indicate an absent or weak trend. A reading under 20 would suggest no trend, and a reading from 20-25 would suggest that there is no clear trend signal. A CCI reading of +100 may represent overbought conditions, while readings near -100 may indicate oversold territory.

BlackRock Floating Rate Income Strategies Fund Inc (FRA) presently has a 14-day Commodity Channel Index (CCI) of 160.38. Despite the name, CCI can be used on other investment tools such as stocks. Typically, the CCI oscillates above and below a zero line. Traders may use the indicator to determine stock trends or to identify overbought/oversold conditions. Normal oscillations tend to stay in the range of -100 to +100. On the other hand, a reading of -100 would imply that the stock is oversold and possibly set for a rally.

Monitoring the numbers on shares of NB Global Floating Rate Income Fund Ltd (NBLS.L), we have noted that the 21 day Wilder Moving Average is now above the 50 day SMA. The 14-day RSI is now at 42.76, the 7-day stands at 39.61, and the 3-day is sitting at 35.55. RSI measures the magnitude and velocity of directional price movements. The value of the position overall is down by 0.0%. When charted, the RSI can serve as a visual means to monitor historical and current strength or weakness in a certain market. The opposite is the case when the RSI line is heading lower. The RSI may be useful for spotting abnormal price activity and volatility. The simple moving average is a mathematical calculation that takes the average price (mean) for a given amount of time. They may also be used to help the trader figure out proper support and resistance levels for the stock.



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