Over 80 stocks in Nifty Midcap 100 hint more room for upside. Time to buy?

Out of the 100 stocks in the Nifty Mid-cap 100 index, only 12 are trading in the overbought category of Relative Strength Index (RSI), signalling more room for other stocks to rally. The stocks in the overbought category include GMR Infrastructure, Bharat Heavy Electricals, Mahindra & Mahindra Financial Services, JSW Energy, Tata Power, Dixon Technologies (India), Indian Hotels Co, Indian Railway Catering And Tourism Corporation, Aarti Industries, Canara Bank, Godrej Properties, Deepak Nitrite and Aegis Logistics.

The RSI is a momentum indicator whose core significance is to determine the underlying strength. To identify the same, the indicator plots stocks in the reading range of 0-100, wherein if any stock crosses 70 value is termed as overbought and expected to see profit booking or selling pressure. Similarly, stocks falling below 30 are identified as oversold stocks, are expected to show a reversal.

Now, among 88 stocks that are trading below the overbought zone, four have not crossed 70 value on a year-to-date basis. These stocks include City Union Bank, Alembic Pharmaceuticals, Crompton Greaves Consumer Electricals and Amara Raja Batteries.

Meanwhile, Trent, which recorded a new all-time high in September 2021, is yet to enter the overbought zone. The stock has surged over 15 per cent since the last record high. Such a state of momentum signals a steady upside.

Also, Power Finance Corporation, Bata India, Nippon Life India Asset Management, Page Industries and Torrent Power have crossed significant previous highs and are trading on the bullish side without entering the overbought condition, according to the daily chart.

Here's is the list of stocks in Nifty Mid-cap 100 trading below overbought zone:

Source: spidesoftwareindia.com

Source: spidesoftwareindia.com