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

Logistics company Chalmers Ltd (ASX:CHR) has been running hot, and with good reason.

The small cap warehouse and storage outfit — backed by trucking magnate Lindsay Fox — recently came into the sights of its larger competitor Qube Logistics (ASX:QUB).

Last Monday Qube lobbed a bidder’s statement for an off-market takeover offer, giving Chalmers shareholders the option to receive 2.31 Qube shares or $6.50 in cash. The offer was unanimously approved by the Chalmers board.

The offer was a 38 per cent premium to Chalmers’ closing price on June 25. The shares in the company continued to climb last week to close on Friday at $7.10.

It was a similar story for IT company GBST Holdings (ASX:GBT), which now finds itself the subject of a bidding war after UK-based FNZ upped the ante with an offer valuing the company at $3.65 per share.

That came after GBST released a statement on Wednesday in which the board said it intended to recommend an indicative bid of $3.60 from US-based suitor SS&C Technologies.

And Capricorn Metals (ASX:CMM) ran hot after providing an update last week on drilling results at its Karlawinda gold project.

The company followed that with news of some key hires and a $15m share placement priced at 6.5c. After rallying last week, shares in CMM are now trading at more than double that at 14.5c.

Here’s a summary of the stocks that were running hot for the two weeks ended Friday, July 5:

Code Name RSI - 2 weeks Price ($) Market Cap
CHR CHALMERS LTD 93.23 7.05 53.68M
CMM CAPRICORN METALS LTD 87.79 0.14 121.75M
GBT GBST HOLDINGS LTD 85.94 3.59 243.13M
TBR TRIBUNE RESOURCES LTD 84.5 6.12 338.57M
CUP COUNTPLUS LTD 84.1 0.93 106.23M
SDV SCIDEV LTD 83.61 0.14 11.80M
OVL ORO VERDE LTD 80.3 0.0045 3.11M
IHL IMPRESSION HEALTHCARE LTD 79.45 0.04 23.86M
CV1 CV CHECK LTD 78.96 0.23 58.69M
MAU MAGNETIC RESOURCES NL 78.88 0.47 91.92M
MOD MOD RESOURCES LTD 78.07 0.43 130.72M
TLX TELIX PHARMACEUTICALS LTD 77.95 1.41 303.53M
CDY CELLMID LTD 77.67 0.25 20.48M
STG STRAKER TRANSLATIONS LTD 77.48 2.1 113.77M
DXB DIMERIX LTD 77.4 0.11 15.88M
MCE MATRIX COMPOSITES & ENG 76.97 0.4 40.93M
BGH BLIGH RESOURCES LTD 75.16 0.14 39.21M

Running cold

Resources minnow Ora Banda Mining (ASX:OBM) recently rejoined the ASX, having completed a recapitalisation program which left the company with $15m in cash to pursue “detailed mine planning and regional exploration programs”.

However, it’s been icy cold on the Relative Strength Index, posting a 2-week reading of just 14.52.

Also falling into this week’s Running Cold section was buy now, pay later platform Splitit (ASX:SPT).

Sentiment for the stock has cooled since it list in January at 20c and promptly surged higher.

At the height of the buying frenzy — when the company’s RSI reading reached 98 — SPT shares hit an intra-day high of $2. They closed on Friday at 52c.

Here’s a summary of the stocks that were running cold for the two weeks ended Friday, July 5:

Code Name RSI - 2 weeks Price ($) Market Cap
SPT SPLITIT PAYMENTS LTD 29.73 0.53 164.53M
NVU NANOVEU LTD 29.58 0.04 5.83M
TGA THORN GROUP LTD 29.56 0.28 46.74M
OMN ONEMARKET LTD 29.33 0.69 69.63M
CDX CARDIEX LTD 29.23 0.02 17.39M
BNO BIONOMICS LTD 29.22 0.04 21.79M
AON APOLLO MINERALS LTD 29.21 0.07 12.78M
AEV AVENIRA LTD 29.11 0.01 5.29M
NCZ NEW CENTURY RESOURCES LTD 28.93 0.42 217.46M
IGN IGNITE LTD 27.65 0.05 4.03M
ENE ENEVIS LTD 27.62 0.2 13.32M
BAU BAUXITE RESOURCES LTD 27.41 0.04 8.36M
LHM LAND & HOMES GROUP LTD 27.27 0.01 9.44M
CGS COGSTATE LTD 26.58 0.16 18.48M
ARC AUSTRALIAN RURAL CAPITAL LTD 26.21 0.36 4.50M
MEL METGASCO LTD 26.11 0.03 18.36M
ED1 EVANS DIXON LTD 26.02 0.8 189.30M
IBG IRONBARK ZINC LTD 25.64 0.02 12.06M
OLH OLDFIELDS HOLDINGS LTD 24.29 0.03 2.79M
HT8 HARRIS TECHNOLOGY GROUP LTD 23.39 0.01 2.22M
REZ RESOURCES & ENERGY GROUP LTD 23.16 0.05 15.11M
P2P P2P TRANSPORT LTD 23 0.12 10.09M
CMC CHINA MAGNESIUM CORP LTD 22.94 0.01 5.09M
UUL ULTIMA UNITED LTD 22.85 0.02 674.49k
LIT LITHIUM AUSTRALIA NL 22.7 0.05 30.08M
XF1 XREF LTD 21.68 0.47 81.13M
SDA SPEEDCAST INTERNATIONAL LTD 21.13 1.83 453.11M
SLC SUPERLOOP LTD 20.57 1.22 321.69M
ARQ ARQ GROUP LTD 18.44 0.71 80.61M
LHB LIONHUB GROUP LTD 16.86 0.005 4.13M
TPC TPC CONSOLIDATED LTD 15.34 0.32 3.37M
OBM ORA BANDA MINING LTD 14.52 0.12 60.71M