Yahoo jumped 3.4% today following an analyst's upbeat call. I guess he is reading my blog and following my footstep? Just kidding. But I think Yahoo is clearly showing the classic sign for overbought. My two best and most reliable indicators are saying that to me: it is moving outside of the upper band of the Bollinger Bands and the RSI is over 80! As the red circles show what happened when RSI went above 80 two times in the past half year. It generally coincided with the stock price curve touching or over the BB upper band and then came down in the next few weeks. I think this is what will happen this time as well. Shorting Yahoo for the short term may be a profitable idea.
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