Each week, Stockhead recaps ASX stocks that are “running hot” as deduced by the Relative Strength Index (RSI).

The RSI is a technical gauge which measures how trading momentum is affecting the price action.

A reading of 70 is seen as the level at which a company may have been overbought. If a stock has a reading of 30 or below, it could be undervalued.

Click here for a more detailed rundown of what the RSI does and how it’s used.

While there’s usually a pretty good reason if a given stock is running hot (or cold), investors are also on the lookout for opportunities where the price action has separated from fundamentals.

Running Hot

Here’s a summary of the stocks that were running hot for the two weeks ended Friday, December 17:

Papua New Guinea-based Steamships Trading Company (ASX:SST) popped up on this week’s list, after posting a couple of solid daily gains last week.

Founded over 100 years ago and headquartered in Port Moresby, the diversified company runs three operational divisions — logistics, property & hotels, and commercial.

Data from Commsec showed SST doesn’t trade every day, which may have upwardly impacted its 14-day RSI print over the past fortnight. The company last made an ASX announcement on October 11.

Another thinly traded stock — the Alternative Investment Trust (ASX:AIQ) — also ran hot after jumping by ~18% last Monday.

The platform — operated by Warana Capital — maintains exposure to various investment funds and debt/equity co-investment structures.

Recently-listed holiday accommodation manager Alloggio Group (ASX:ALO) rounded out the top 3 on this week’s list, posting four straight winning sessions last week to climb back to 19.5c — just shy of its 20c November listing price after the stock fell on debut.

Running Cold

Here’s a summary of the stocks that were running cold for the two weeks ended Friday, December 17:

After a brutal week for the sector, it perhaps wasn’t surprising to see a number of ASX BNPL stocks post an RSI of 30 or below over the past fortnight.

Zip Co (ASX:Z1P), the second largest competitor, has fallen by ~35% since the start of November and registered a 14-day RSI of 30.

Industry leader Afterpay (ASX:APT) has also fallen by more than 30% in that time and registered an RSI of 25, while sector-adjacent stock Zebit (ASX:ZBT), which provides BNPL services to users of its US-based online shopping marketplace, fell to new all-time lows beneath 30c with a 14-day RSI of 27.