Most oversold and overbought stocks on the TSX right now
The S&P/TSX fell 3.6% last week and its RSI sits at 39. Fifteen index stocks are technically oversold, five are overbought, and a handful are setting 52-week highs or lows.
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By Torontoer Staff
The S&P/TSX Composite dropped 3.6 per cent for the trading week ending Friday and is up 0.8 per cent year to date. The benchmark’s Relative Strength Index, or RSI, sits at 39, placing it in the lower part of neutral territory and closer to the oversold threshold of 30 than the overbought level of 70.
Across the index, 15 constituents have RSIs below the conventional buy signal of 30. At the other extreme, five names show overbought RSIs that suggest a higher risk of a short-term pullback. Several companies are also recording fresh 52-week highs and lows.
Market snapshot
A one-week decline of 3.6 per cent tightened focus on momentum indicators. The composite’s RSI of 39 indicates downward pressure, but it is not yet in deeply oversold territory. Technical traders monitor RSI readings for signs of trend exhaustion or continuation, while fundamental investors typically treat them as one input among many.
Most oversold TSX stocks
Fifteen index constituents have RSIs below 30, a level often used to flag oversold conditions. Oversold does not guarantee a rebound, but it can highlight shares where price momentum has turned strongly negative and may be near a turning point for traders watching for mean reversion.
- Open Text Corp.
- Altus Group Ltd.
- Kinaxis Inc.
- Thomson Reuters Corp.
- Intact Financial Corp.
These companies span software, real estate services, logistics software, media and insurance. Each faces different fundamentals, so an oversold RSI should be paired with company-level analysis before making investment decisions.
Most overbought TSX stocks
At the other end of the spectrum, five TSX names carry RSIs that classify them as overbought. That condition can precede a short-term pullback, particularly in volatile sectors or after sharp recent gains.
- Spartan Delta Corp.
- BCE Inc.
- Suncor Energy Inc.
- Pembina Pipeline Corp.
- Prairiesky Royalty Ltd.
Investors should consider whether recent price gains reflect improving fundamentals, one-off events, or short-term speculative flows, especially in energy and pipeline names where commodity prices and spreads matter.
New 52-week highs and lows
Momentum can also be measured by fresh highs and lows. A small group of TSX constituents are making 52-week highs, while others are at 52-week lows, underscoring divergent performance across sectors.
- Companies hitting new 52-week highs: Prairiesky Royalty Ltd., Peyto Exploration & Development Corp., Topaz Energy Corp., Enerflex Ltd., 5N Plus Inc.
- Notable 52-week lows: Constellation Software Inc., Metro Inc., Descartes Systems Group Inc.
Some smaller names are driving the new-high list by market capitalisation, while large-cap technology and retail names appearing on the low list reflect sustained selling pressure.
How investors can use momentum signals
RSI below 30 can signal oversold conditions, but it does not guarantee a rebound. Traders should look for confirmation from volume, trend lines and fundamental catalysts.
Momentum indicators are tools, not verdicts. Use them with other signals to avoid mistaking short-term noise for durable opportunity. Below are practical checks to consider before acting on oversold or overbought readings.
- Check fundamentals: earnings trends, cash flow and balance sheet strength can confirm whether price moves match company health.
- Look for confirmation: rising volume on a bounce or breakdown supports the signal, while weak volume suggests limited conviction.
- Consider time horizon: short-term traders may trade RSI reversions, long-term investors should prioritise fundamentals over technical extremes.
- Watch for catalysts: earnings, regulatory decisions, commodity moves or macro data can validate or invalidate technical signals.
- Manage risk: use position sizing and stop-losses, since oversold stocks can stay depressed and overbought stocks can extend gains.
What this means for Toronto investors
The recent weekly decline and an index RSI near 39 mean market momentum is skewed toward sellers, but the situation is not extreme. Investors should treat oversold and overbought readings as starting points for deeper analysis, not as sole triggers for buying or selling.
For those tracking the TSX, the current mix of oversold, overbought and new-high names highlights a market with active rotation across sectors. Balanced portfolios and disciplined research remain the primary tools for navigating such conditions.
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