Dollar General tops list of most overbought stocks due for a pullback
A range of retail, financial services and artificial intelligence stocks may soon slide, according to one of the popular yardsticks used in technical analysis. Stocks rose on Friday , advancing for a fourth straight day and approaching all-time highs as the year draws to a close. The S & P 500 added 0.3% this past week, the Dow Jones Industrial Average tacked on 0.5% and the Nasdaq Composite rose 0.9%. The latest rally, ahead of an expected quarter-point cut in interest rates by the Federal Reserve at its last meeting of the year next week, is sending some of the best performers to the point where they’re looking overbought. In an attempt to find the stocks that have run the farthest and the fastest, and may now be overextended, we used the CNBC Pro stock screener to identify those companies with 14-day relative strength index (RSI) values above 70 — a threshold suggesting future weakness — and weekly gains of at least 5%. Stocks such as Dollar General , mobile technology provider AppLovin and Wells Fargo were among the stocks that turned up as most overbought. Here are some that could see their shares stumble: Dollar General topped the list of overbought stocks with an RSI of 85. Its shares jumped nearly 17% last week through midday Friday after it raised its same-store sales, earnings and revenue forecasts for 2026. AppLovin shares also appear overbought, with an RSI of 71.4. The $235 billion market cap rallied nearly 15% in the five days though midday Friday, and has now more than doubled in 2025. The gains come after the mobile advertising technology company last week forecast multi-year growth in the market for gaming advertising. AppLovin said the gains would be fueled by enhancements to its mobile advertising and app monetization platforms. Oversold After the market’s latest move higher, fewer stocks screen as oversold, but there are a handful, the CNBC Pro stock screener shows. Oversold stocks have RSIs below 30 and lost 5% or more last week, again as of midday Friday. W R Berkley topped the stocks that may be set up for a near-term bounce. The property and casualty insurer has an RSI of 20.2 after its stock slumped 9% on the week. Alexandria Real Estate Equities, a real-estate investment trust with an RSI of 25.3, is unloved after its stock slumped about 13% last week in reaction to it slashing its quarterly dividend 46%. The Pasadena, California property owner also reduced its 2026 funds from operations per share outlook to a range of $6.25 to $6.55, below analysts’ consensus estimate of $6.88, according to FactSet.
<
