These are the most overbought and oversold ASX 200 stocks – Week 48

The S&P/ASX 200 is currently trading at all-time highs, resulting in a market landscape where numerous stocks have rallied into overbought territory, while very few remain deeply oversold.

The 14-day Relative Strength Index is a momentum indicator that measures the magnitude and speed of recent price changes to assess whether or not a stock is overbought or oversold. In this weekly series, we observe some of the market's most overbought and oversold stocks.

An RSI of 70 or above is considered to be overbought, which means the stock is rising too quickly and likely to experience a pullback. Meanwhile, an RSI of 30 or below is considered to be oversold, which means the stock is falling too quickly and is likely to experience a rebound.

Most Overbought ASX 200 Stocks

Key takeaways:

• Pro Medicus has emerged as one of the most extraordinary growth stories this year, boasting an unprecedented streak of consecutive monthly gains since October 2023. The stock's performance is underpinned by a series of catalysts, including better-than-expected earnings and high-profile contract wins. Most notably, the company's recent announcement of a $330 million ten-year contract with Trinity Health propelled its share price 8.6% higher to record levels.

• The current soaring equity markets have created a prime environment for stocks delivering exceptional performance. Companies like HMC Capital (with impressive funds under management growth), Guzman Y Gomez (exceeding FY24 earnings prospectus), and Technology One (surpassing market expectations in recent earnings) have particularly benefited, gathering significant upside and market momentum.

Most Oversold ASX 200 Stocks

Key takeaways:

• The most oversold stocks list resembles a graveyard of resource sector casualties, with lithium, rare earths, and uranium stocks bearing the brunt of market sentiment. Pilbara Minerals experienced a brutal ten-day losing streak from 14-28 November that saw the stock plummet 25% to near two-and-a-half year lows.

• Centuria Industrial represents a broader narrative of real estate stocks struggling to gain traction amid volatile bond market conditions. The dramatic surge in the US 10-year yield—climbing from 3.6% in September to peaks of 4.45% by mid-November—has created significant headwinds. Consequently, Centuria's shares have slipped around 10%, hovering close to year-to-date lows.