As of Feb. 12, 2024, five 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.
Here’s the latest list of major overbought players in this sector.
1. Aterian, Inc. (ATER):
– On Nov. 8, Aterian posted a narrower loss for the third quarter. The company’s stock gained around 93% over the past month and has a 52-week high of $1.3950.
– RSI Value: 82.51
– ATER Price Action: Shares of Aterian jumped 18.7% to close at $0.4321 on Friday.
2. AMMO, Inc. (POWW):
– On Feb. 8, AMMO posted a profit for the third quarter. Jared Smith, AMMO’s CEO, commented “Despite the challenges we faced in calendar 2023 for our industry, Ammo Inc. continues to transition its business to a stronger and leaner operating model. We have emerged from this time with an impeccable balance sheet and remain encouraged about the significant opportunities we have before us here in the fourth quarter and going forward.” The company’s stock gained around 14% over the past five days and has a 52-week high of $3.15.
– RSI Value: 76.51
– POWW Price Action: Shares of AMMO gained 13.6% to close at $2.51 on Friday.
3. Harley-Davidson, Inc. (HOG):
– On Feb. 8, Harley-Davidson reported fourth-quarter fiscal 2023 HDMC + LiveWire sales of $807 million, missing the consensus of $880.22 million. “We are excited by the early read of our new Model Year launch, the most comprehensive product development in the touring platform in well over 10 years, that will redefine the Harley-Davidson Grand American Touring experience for years to come and lay the foundation to drive retail sales growth in ’24,” commented Jochen Zeitz, Chairman, President and CEO, Harley-Davidson. The company’s stock gained around 10% over the past five days and has a 52-week high of $49.39.
– RSI Value: 73.05
– HOG Price Action: Shares of Harley-Davidson gained 5.6% to close at $36.85 on Friday.
4. Victoria’s Secret & Co. (VSCO):
– On Jan. 11, Victoria’s Secret and Google Cloud announced a strategic, multi-year partnership to leverage Google Cloud’s AI and generative AI technologies to create more personalized and inclusive online shopping experiences for its global customers. The company’s stock jumped around 23% over the past month and has a 52-week high of $42.71.
– RSI Value: 73.68
– VSCO Price Action: Shares of Victoria’s Secret gained 4.6% to close at $29.22 on Friday.
5. Worthington Enterprises, Inc. (WOR):
– On Feb. 1, Worthington Enterprises acquired an 80% ownership stake in an affiliate of HALO Products Group. The company’s stock jumped around 15% over the past month and has a 52-week high of $63.87.
– RSI Value: 76.42
– WOR Price Action: Shares of Worthington Enterprises gained 7.6% to close at $62.60 on Friday.
Investors should exercise caution when considering these stocks, as their high RSI values suggest they may be overbought. It’s important to conduct thorough research and consider other indicators before making any investment decisions.
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