Trending stocks like EKM can and will stay in the overbought zone for an extended period of time. This does not mean that they will drop back below the overbought line.
Take a look at MHM. It was overbought at 29c but proceeded to hit 120c in the following 5 business days.
Take a look at AVB. It was overbought at 4.9c but proceeded to hit 23c in the following 15 business days.
If you bought any stock in March 2009, the stock would have become overbought by the end of March. If you sold then you would have missed the ride of your life.
Stocks in overbought territory do go down. But it is in no way a sure indicator that it will drop back. All it means is that its pushing the upper price boundary of your prior lookback period.
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