Sometimes a stock can be too popular for its own good. As of December 26, 2025, three consumer discretionary stocks are flashing warning signs for investors who pay attention to momentum indicators, even as Wall Street analysts remain bullish on their prospects.
The Relative Strength Index (RSI) measures momentum by comparing a stock's performance on up days versus down days. Think of it as a fever thermometer for stocks. When the RSI climbs above 70, it typically signals that an asset has become overbought—meaning it might have run too far, too fast, and could be due for a breather or pullback.
Here's a look at three major consumer names that are currently running hot, perhaps too hot.
General Motors Co (GM)
The Detroit automaker has gained roughly 11% over the past month, pushing its RSI to 77. On December 18, Wedbush analyst Dan Ives maintained an Outperform rating and boosted his price target from $75 to $95, suggesting he sees more room to run despite the elevated momentum reading.
RSI Value: 77
Price Action: Shares of General Motors rose 0.2% to close at $82.88 on Wednesday, approaching the company's 52-week high of $83.68.
Edge Stock Ratings: Momentum score of 91.81 with Value at 78.87, indicating strong performance on both technical and valuation metrics.
Tapestry Inc (TPR)
The luxury goods company behind Coach, Kate Spade, and Stuart Weitzman has climbed about 18% over the past month, bringing its RSI to 76.9. On December 16, Wells Fargo analyst Ike Boruchow maintained an Overweight rating and lifted his price target from $125 to $135.
RSI Value: 76.9
Price Action: Shares of Tapestry rose 0.6% to close at $130.20 on Wednesday, nearing the 52-week high of $130.93.
Abercrombie & Fitch Co (ANF)
The apparel retailer posts the highest overbought reading of the three, with an RSI of 82.3 after surging 33% over the past month. That's a remarkable run for any stock. On December 11, Goldman Sachs analyst Jon Keypour initiated coverage with a Buy rating and a $120 price target.
RSI Value: 82.3
Price Action: Shares of Abercrombie & Fitch gained 2.4% to close at $126.74 on Wednesday. The stock's 52-week high sits at $164.80, suggesting it's already cooled off from earlier peaks.
The interesting tension here is that all three stocks carry bullish analyst ratings even as their technical indicators flash caution. It's a reminder that momentum indicators tell you about the journey, not necessarily the destination. A stock can be overbought and still have solid fundamentals—it just might need to catch its breath before climbing higher.
