ETMarkets.comThe RSI is a momentum oscillator that quantifies the speed and magnitude of stock price movements. It is calculated based on the average gains and losses over a specified period, typically 14 days. RSI values range from 0 to 100, with values above 70 indicating an overbought condition, suggesting that the stock's price may have risen too quickly and could experience a correction.
Importance of Assessing Stock Movement Based on RSI
Assessing stock movement based on RSI is vital for investors to make prudent decisions. When a stock's RSI rises above 70, it indicates that the stock may be overbought and could be due for a pullback or correction. Overbought conditions suggest that the stock's price has risen too rapidly and may not be sustainable in the short term. As a result, investors should exercise caution when dealing with overbought stocks to avoid potential losses.
ETMarkets' Top 10 Picks: Stocks in Overbought Zone:
On Monday, July 31st, StockEdge reported that over 120 stocks were trading in an overbought zone. From this extensive list, ETMarkets has carefully selected 10 stocks that investors should be cautious about:
Esab India Ltd. - RSI: 86.58, Prev. RSI: 89.97
Sterling and Wilson Renewable Energy Ltd. - RSI: 86.56, Prev. RSI: 84.41
Tata Motors Ltd. - DVR Ordinary - RSI: 86.35, Prev. RSI: 86.21
Cipla Ltd. - RSI: 86.15, Prev. RSI: 87.5
Power Finance Corporation Ltd. - RSI: 85.68, Prev. RSI: 83.94
Godfrey Phillips India Ltd. - RSI: 85.56, Prev. RSI: 83.3
Natco Pharma Ltd. - RSI: 84.93, Prev. RSI: 84.26
BEML Ltd. - RSI: 84.72, Prev. RSI: 75.54
Ipca Laboratories Ltd. - RSI: 84.65, Prev. RSI: 82.61
Data pertaining to stocks whose RSI was trading bearish while the stocks were overbought on August 1, Tuesday will be updated later today.
(Disclaimer: This is an AI-generated article. Recommendations, suggestions, views, and opinions given by experts are their own. These do not represent the views of the Economic Times)
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