During a busy week for Wall Street — including Nvidia’s earnings announcement and Federal Reserve Chair Jerome Powell’s Jackson Hole speech — investors are favoring certain stocks over others. The S & P 500 and the Nasdaq Composite managed to break a three-week losing streak, gaining 0.7% and 0.9%, respectively. Meanwhile, the 30-stock Dow Jones Industrial Average ticked down for the second consecutive week. The relative strength index, which measures the magnitude and speed of price moves, is one way to evaluate whether shares are overbought or oversold. A stock with a 14-day RSI below 30 is considered oversold — implying that it could be a promising entry point for investors. Meanwhile, equities with a 14-day RSI higher than 70 are likely overbought — and may be due for a pullback soon. With this in mind, CNBC Pro screened for stocks in the broad market index that fell into overbought and oversold territory this past week. Take a look at the names on the list, and where Wall Street sees them headed next. Oversold stocks Here are the 10-most oversold names. Half of the names on the list fell in the health-care sector. Among these names, Insulet , a manufacturer of insulin delivery systems, had the lowest 14-day RSI of 6.1 on the list. Shares reached a 52-week low during Friday’s trading session, and the stock is down nearly 38% in 2023. However, many analysts believe an inflection point could be ahead for the stock. Citi upgraded shares to buy from neutral in a Monday note, citing the stock’s attractive valuation. Around 52% of the analysts covering the stock rate it a buy, with their average price targets suggesting 55.2% upside, according to Refinitiv. PODD 5D mountain Insulet Corp shares Clothing brand Ralph Lauren has the lowest 14-day RSI of 2.9 on the list. The company’s average price target suggests more than 21% upside potential. Shares have lost nearly 15% in August following the company’s fiscal first-quarter earnings announcement earlier in the month. Investor sentiment took a negative turn after the company failed to raise its guidance for the full-year. To be sure, analysts aren’t so sure on the stock. Just 36.8% of analysts covering Ralph Lauren rate it a buy, according to Refinitiv. While the stock is up 5.8% year to date, it has lagged the S & P 500’s gains of nearly 15%. Citigroup stock lost more than 3% over the past trading week, making it one of the financial sector’s biggest decliners in the period, and the only name in the sector to make the list. The banking giant has an RSI of 7.5. Approximately a third of analysts covering shares have issued a buy rating, per Refinitiv data. The stock’s average price target implies shares rallying more than 33%. The stock is down almost 9% in 2023. Overbought stocks Here are the ten most overbought stocks for the week. Several technology names made the list of overbought names, suggesting they may soon experience a pullback. FactSet and DXC had the highest RSIs among the group of 78.1 and 75.6, respectively. Wall Street is not bullish on FactSet, which is currently trading 0.1% higher than the consensus analyst price target. A little over a fifth of the analysts polled by Refinitiv rate the stock a buy. FactSet shares are up 7% year to date. Meanwhile, no analysts covering DXC rate it a buy. Nonetheless, the info tech company’s average price target suggests 20.7% upside. The stock has plunged 22.6% over the past year. Eli Lilly was the most overbought stock in the broad market index this week, with the highest 14-day RSI value of 85.8. Shares have hit record highs in August as optimism grows around its new obesity and Alzheimer’s drugs, which are awaiting regulatory approval. Shares have surged more than 51% in 2023. They’re now trading 0.4% above their average price target, meaning the stock may soon see a correction.
Sumber: www.cnbc.com
