The S&P/TSX Composite Index experienced a significant decline of 3.6% during the trading week, concluding on Friday. Despite this drop, the index remains 5.0% higher for the year 2026, including dividends.
Understanding Oversold and Overbought Stocks on the TSX
The current market situation has led to a Relative Strength Index (RSI) of 46, which is close to the midpoint. The RSI indicates proximity to both oversold buy signals, typically identified below 30, and overbought sell signals above 70.
Oversold Stocks on TSX
Six companies are categorized as oversold with their RSIs below the key 30 level. These stocks are potential candidates for investors seeking undervalued opportunities:
- Allied Properties REIT
- Pet Valu Holdings Ltd.
- Gildan Activewear Inc.
- BRP Inc.
- Algonquin Power and Utilities Corp.
- IA Financial Corp Inc.
Overbought Stocks on TSX
In contrast, the list of overbought stocks is much shorter this week, comprising seven companies. High energy prices have positioned Canadian Natural Resources Ltd. as the most overbought stock:
- Canadian Natural Resources Ltd.
- Atco Ltd.
- Paramount Resources Ltd.
- Peyto Explorations and Development Corp.
- Quebecor Inc.
- Hydro One Ltd.
- Dye and Durham Ltd.
Stocks Showing Strong Price Momentum
Nine stocks have demonstrated robust price momentum by reaching new 52-week highs. The companies, listed below in order of market capitalization, are notable performers:
| Rank | Company |
|---|---|
| 1 | Canadian Natural Resources |
| 2 | Hydro One |
| 3 | Whitecap Resources |
| 4 | Canadian Utilities Ltd. |
| 5 | Atco Ltd. |
New 52-Week Lows
On the other end of the performance spectrum, two companies have hit new 52-week lows:
- FirstService Corp
- Allied Properties
This analysis of oversold and overbought stocks on the TSX provides insight into market behavior and potential investment opportunities.
