As of May 3, 2024, two stocks in the consumer discretionary sector could be flashing a real warning to investors who value momentum as a key criteria in their trading decisions.
The RSI is a momentum indicator, which compares a stock’s strength on days when prices go up to its strength on days when prices go down. When compared to a stock’s price action, it can give traders a better sense of how a stock may perform in the short term. An asset is typically considered overbought when the RSI is above 70, according to Benzinga Pro. Â
Here’s the latest list of major overbought players in this sector.
Alibaba Group Holding Limited (NYSE:BABA)
- On April 19, Alibaba Group Holding introduced a novel shopping application for Taobao, China’s largest online market. The application is designed for Apple’s Vision Pro mixed-reality headset. The company’s stock gained around 11% over the past month and has a 52-week high of $102.50.
- RSI Value: 71.40
- BABA Price Action: Shares of Alibaba gained 6.4% to close at $80.33 on Thursday.
Brinker International, Inc. (NYSE:EAT)
- On April 30, Brinker reported strong third-quarter financial results and raised FY24 guidance. The company raised its FY24 adjusted EPS outlook from $3.45-$3.70 to $3.80-$4.00 against the estimate of $3.69. billion against an estimate of $4.338 billion. The company’s stock gained around 13% over the past five days and has a 52-week high of $55.92.
- RSI Value: 71.19
- EAT Price Action: Shares of Brinker fell 1.1% to close at $54.34 on Thursday.
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