On February 21, 2024, two stocks in the materials sector are raising red flags for investors who prioritize momentum in their trading strategies.

The RSI (Relative Strength Index) is a momentum indicator that compares a stock’s strength on up days to its strength on down days. When viewed alongside a stock’s price action, it offers traders insight into the potential short-term performance of a stock. An asset is often considered overbought when the RSI exceeds 70, as per Benzinga Pro.

Let’s dive into the specifics of the two major overbought players in this sector.

PureCycle Technologies, Inc. PCT

• On January 16, PureCycle provided an update for its Ironton production facility, citing the production of 183,000 pounds of pellets in the last two weeks. The company’s stock surged by approximately 32% over the past five days and currently holds a 52-week high of $11.89.
• RSI Value: 70.28
• PCT Price Action: Shares of PureCycle Technologies rose by 4.3% to close at $5.89 on Tuesday.

IperionX Limited IPX

• IperionX is progressing toward commercial scaling of its titanium metal production. With its HAMR titanium furnace set for installation in the U.S. in early 2024 and production expected to commence by mid-year, IperionX has made substantial strides in enhancing its titanium production capabilities. The company’s stock surged by around 38% over the past month and currently holds a 52-week high of $18.57.
• RSI Value: 72.51
• IPX Price Action: Shares of IperionX declined by 3.2% to close at $14.62 on Tuesday.

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