The relative strength index (RSI) is an important technical indicator for stock traders.

It provides a measure of which stocks are most in demand, and which stocks investors are neglecting.

Often, changes in the RSI are reflective of market reactions to market announcements or changes in earnings forecasts.

But it can also offer a gauge on which stocks may be running ahead of their earnings fundamentals, and alternatively which companies might be running under the radar.

Each week, Stockhead provides a simple summary of outliers on the RSI, to get a technical gauge of how trading momentum is affecting the price action.

A reading of 70 is seen as the level at which a company’s been overbought. If a stock has a reading of 30 or below, it may be undervalued. Here’s this week’s list:

Running Hot

Acacia Coal (ASX:AJC) ran hottest over the past two weeks with an RSI of 86.08.

Most of that appears to have driven by a round of buying at the end of last week, which saw the stock price tick higher with a 100 per cent gain to 0.2c.

There was no obvious catalyst for the late run of demand, after Acacia announced a month ago it had signed All Points Sampling to do the initial exploration activities at its Mt Bruce copper-cobalt project in northern WA.

Also posting a reading above 80 was casino hotel company Donaco International (ASX:DNA), which rose strongly last week after the company announced it had refinanced a $US22.8m loan facility with the Mega International Commercial Bank of Taiwan.

And after topping last week’s Hot Money list, medicinal cannabis company Impression Healthcare (ASX:IHL) rounded out the list of companies with a reading above 80, coming in at 80.68. IHL’s gains cooled off last week but the stock price still doubled in June.

Here’s a summary of the stocks that were running hot for the two weeks ended Friday, June 28:

Running cold

Over the last two weeks there were 25 companies that posted an RSI below 25.

There were some familiar names at the lower end of the list, as stocks running extra-cold are usually doing so because the market has decided something is wrong.

But it was a new name bringing up the tail, with internet domain company Arq Group (ASX:ARQ) posting a reading of just 10.66.

Shares in ARQ slumped by more than 40 per cent last week after it flagged another large earnings downgrade, just one month after CEO Martin Mercer offloaded a bunch of shares — equivalent to one third of this stake in the company.

Mercer said he did so “reluctantly” in order to “meet tax obligations”.

Here’s a summary of the stocks that were running cold for the two weeks ended Friday, June 28: