High positive momentum and overbought

RSI above 70 shows strong positive momentum in the stock. The stock has risen in the short term, with few reactions downwards. Investors have continued to pay more to buy stocks. This indicates that more buyers are entering the stock and that the price will continue to rise.

RSI above 70 used to be considered a sign of danger. These stocks were said to be overbought and it was assumed they would soon see a reaction down. However, Investtech’s research shows that these stocks have continued to rise, in fact more so than the market.

The following applies to high RSI:

Indicates short term strength
Indicates that investors are positive and that the price will continue to rise
Many investors think this is a negative signal, but our research shows it is clearly positive

In general we want high RSI, i.e. strong short term momentum, for stocks we own or are going to buy. It can be a psychological challenge to buy such stocks, since they have already risen quite a bit and may seem expensive. However, high RSI indicates that more investors are buying and that the rise will continue.

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Stocks withHigh positive momentum and overbought

Hafnia Limited

Storebrand

MPC Container Ships

Gjensidige Forsikring

BW LPG

Wallenius Wilhelmsen

Aker Solutions

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