Watch Out: These Stocks Appear Overbought
Money pro Barry Sine of Drexel Hamilton has identified 6 stocks that he says look problematic.
Sine looks at technical indicators and momentum oscillators and from his analysis concludes about a half dozen stocks appear to be overbought.
“What I did is I looked at two indicators,” he tells CNBC’s Fast Money, “The relative strength index or RSI and the stochastic oscillator.”
That’s a little confusing.
In simple terms, the technicals suggest to Mr. Sine that the following stocks have gone too far too fast, and are now at risk:
Chipotle Mexican Grill
Family Dollar Stores
If you think the market is getting choppy and that we're due for a round of profit taking, these names may be the first to pull back, according to Sine.
Trader Jon Najarian adds that the thesis makes sense. “Folks are looking to take some off the table after the big run. And the first place they'll go are high 'momo' names such as these.”
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CNBC.com with wires.