HomeMarket NewsSmall CapsThe Overbought Consumer Stocks that May Plummet in This Quarter

The Overbought Consumer Stocks that May Plummet in This Quarter

Actionable Trade Ideas

always free


An Opportunity to Go Short on Overvalued Consumer Stocks

If you’re an investor or trader in the financial market, it’s crucial to identify the most overbought stocks in the consumer discretionary sector. These stocks present an opportunity to take a short position and potentially profit from their decline in value.

One key indicator to consider is the RSI (Relative Strength Index). The RSI is a momentum indicator that compares a stock’s strength on days when prices go up to its strength on days when prices go down. By analyzing the RSI in relation to a stock’s price action, traders can gain insights into how a stock may perform in the short term. Typically, an asset is considered overbought when the RSI is above 70.


  • AMMO, Inc. recently reported a profit in the first quarter. CEO Jared Smith expressed optimism, stating, β€œOur work toward achieving our strategic goals are starting to pay off as we have already begun to see the positive effects here in the 1st quarter, with significant improvements in gross margin and strong cash flow.” The company’s stock has reached a 52-week high of $3.35.
  • RSI Value: 73.63
  • POWW Price Action: Shares of AMMO closed at $2.64 on Friday.

Smith & Wesson Brands, Inc. (SWBI)

  • Smith & Wesson’s board recently authorized a new buyback of up to $50 million. CEO Mark Smith stated, β€œWith the bulk of our investment in the move of our headquarters and significant elements of our operations to Tennessee soon coming to an end, we intend to rebalance our capital allocation strategy towards returning excess capital to our stockholders. This stock repurchase program is a key element of that strategy.” The company’s stock has a 52-week high of $14.55.
  • RSI Value: 72.93
  • SWBI Price Action: Shares of Smith & Wesson Brands fell 0.9% to close at $13.97 on Friday.

E-Home Household Service Holdings Limited (EJH)

  • E-Home Household Service Holdings Limited has seen a significant increase of around 65% in its stock price over the past month. The company has reached a 52-week high of $150.00.
  • RSI Value: 77.94
  • EJH Price Action: Shares of E-Home Household Service fell 1.2% to close at $1.70 on Friday.

Chico’s FAS, Inc. (CHS)

  • Chico’s FAS recently announced a definitive agreement to be acquired by private equity firm Sycamore Partners for $1 billion. The company has reached a 52-week high of $7.53.
  • RSI Value: 80.45
  • CHS Price Action: Shares of Chico’s FAS closed at $7.49 on Friday.

Identifying overbought consumer stocks can be a valuable strategy for traders who aim to profit from potential price reversals. By analyzing the RSI values and considering the recent price actions of these stocks, investors can make informed decisions in managing their portfolios.

Read More: Airbnb, Chewy, and 2 Other Stocks Insiders Are Selling

Swing Trading Ideas and Market Commentary

Need some new swing ideas? Get free weekly swing ideas and market commentary from Jonathan Bernstein here: Swing Trading.

Explore More

Weekly In-Depth Market Analysis and Actionable Trade Ideas

Get institutional-level analysis and trade ideas to take your trading to the next level, sign up for free and become apart of the community.