In trading on Friday, shares of Boardwalk Pipeline Partners LP (NYSE: BWP) entered into overbought territory, changing hands as high as $28.1532 per share. We define overbought territory using the Relative Strength Index, or RSI, which is a technical analysis indicator used to measure momentum on a scale of zero to 100. A stock is considered to be overbought if the RSI reading rises above 70.
In the case of Boardwalk Pipeline Partners LP, the RSI reading has hit 71.0 — by comparison, the universe of energy stocks covered by Energy Stock Channel currently has an average RSI of 55.6, the RSI of WTI Crude Oil is at 53.9, and the RSI of Henry Hub Natural Gas is presently 46.6.
A bearish investor could look at BWP's 71.0 reading as a sign that the recent heavy buying is in the process of exhausting itself, and shares are due for a pullback.
Looking at a chart of one year performance (below), BWP's low point in its 52 week range is $23.55 per share, with $34.18 as the 52 week high point — that compares with a last trade of $28.13. Boardwalk Pipeline Partners LP shares are currently trading up about 2.1% on the day.
According to the ETF Finder at ETF Channel, BWP makes up 1.01% of the Guggenheim Defensive Equity ETF (AMEX: DEF) which is trading higher by about 1.6% on the day Friday.
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BWP operates in the Oil & Gas Equipment & Services sector, among companies like Complete Production Services Inc (NYSE: CPX) which is off about 0.5% today, and TC PipeLines, LP (NASD: TCLP) trading higher by about 0.8%. Below is a three month price history chart comparing the stock performance of BWP, versus CPX and TCLP.
