As of May 29, 2024, three stocks in the information technology sector could be flashing a real warning to investors who value momentum as a key criteria in their trading decisions.

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, according to Benzinga Pro.

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

Ooma, Inc. (NYSE:OOMA)

• On May 28, Ooma reported better-than-expected first-quarter financial results and issued strong guidance for the second quarter. The company also issued FY25 adjusted EPS guidance above estimates. “Ooma made a solid start to fiscal 2025 by delivering $62.5 million in revenue and $3.6 million of non-GAAP net income for our first quarter,” said Eric Stang, chief executive officer of Ooma. The company's stock gained around 10% over the past month and has a 52-week high of $15.66.
• RSI Value: 70.13                              
• OOMA Price Action: Shares of Ooma rose 3.8% to close at $7.90 on Tuesday.

Analog Devices, Inc. (NASDAQ:ADI)

Avnet, Inc. (NASDAQ:AVT)

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