Top 3 Tech Stocks That May Fall Off A Cliff

The most overbought stocks in the information technology sector presents an opportunity to go short on these overvalued companies.

The RSI is a momentum indicator, which compares a stock's strength on days when prices go up to its strength on days when prices go down. When compared to a stock's price action, it can give traders a better sense of how a stock may perform in the short term. An asset is typically considered overbought when the RSI is above 70.

Here’s the latest list of major overbought players in this sector.

National Instruments Corporation NATI

• National Instruments reported weaker-than-expected second-quarter results. "I am pleased with our results in the second quarter. We delivered record revenue for a second quarter, along with strong operating margin and EPS, which demonstrates the operating leverage we have developed through our ongoing transformation. Revenue was up 5 percent year-over-year and was bolstered by our strong backlog, even as orders weakened more than we initially anticipated throughout the quarter," said Eric Starkloff, NI President and CEO. The company’s stock has a 52-week high of $59.40. .
• RSI Value: 71.55
• NATI Price Action: Shares of National Instruments fell 0.1% to close at $59.34 on Tuesday.

CDW Corporation CDW

• CDW reported a second-quarter FY23 net sales decline of 8.5% Y/Y to $5.63 billion, beating the consensus of $5.40 billion. "Through this ongoing period of economic uncertainty, customers continue to turn to CDW to address their mission-critical IT and operational needs across the full IT solutions stack and lifecycle. We remain well-positioned to attain our target of exceeding US IT market growth by 200 to 300 basis points on a constant currency basis," stated Christine A. Leahy, chair and chief executive officer. The company’s stock has a 52-week high of $215.00.
• RSI Value: 74.39
• CDW Price Action: Shares of CDW fell 0.1% to close at $202.68 on Tuesday.

PC Connection, Inc. CNXN

• PC Connection posted upbeat second-quarter earnings. "We executed well against our strategic plans during the second quarter. We are successfully transitioning our business, driving growth in integrated technology solutions and services across each of our segments, resulting in a 90 basis point improvement in consolidated gross margin," said Timothy McGrath, President and Chief Executive Officer of Connection. The company has a 52-week high of $56.68.
• RSI Value: 81.07
• CNXN Price Action: Shares of PC Connection rose 1% to close at $53.98 on Tuesday.

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