Top 5 Consumer Stocks That May Implode This Quarter

The most overbought stocks in the consumer discretionary 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.

New Oriental Education & Technology Group Inc. EDU

New Oriental Education & Technology Group reported fourth-quarter sales growth of 64.2% year-on-year to $860.6 million, beating the consensus of $820.1 million. The company sees first-quarter FY24 total net revenues of $983.2 million - $1,005.5 million (consensus $939.47 million), representing growth of 32%-35% Y/Y. The company’s stock has a 52-week high of $63.28. .
RSI Value: 70.80
EDU Price Action: Shares of New Oriental Education gained 2.7% to close at $62.62 on Tuesday.

E-Home Household Service Holdings Limited EJH

The company’s stock jumped 51% over the past month. The company’s stock has a 52-week high of $178.99.
RSI Value: 73.64
EJH Price Action: Shares of E-Home Household Service gained 10.2% to close at $1.51 on Tuesday.

PDD Holdings Inc. PDD

Grizzly Research, last month, released a short report on the company claiming the company's TEMU shopping app is spyware. The company has a 52-week high of $110.35.
RSI Value: 72.97
PDD Price Action: Shares of PDD Holdings rose 2.4% to close at $109.55 on Tuesday.

TAL Education Group TAL

TAL Education posted better-than-expected first-quarter sales. The company’s 52-week high is $10.45.
RSI Value: 74.56
TAL Price Action: Shares of TAL Education rose 6.2% to close at $9.56 on Tuesday.

Abercrombie & Fitch Co. ANF

Abercrombie & Fitch reported better-than-expected second-quarter results. The company also reported a decline in inventories and raised its FY23 sales growth outlook. The company has a 52-week high of $59.88.
RSI Value: 70.32
ANF Price Action: Shares of Abercrombie & Fitch rose 5.1% to settle at $59.77 on Tuesday.