Cisco stock flashes rare technical signal 

Back in 2025, when Cisco Systems (CSCO) was trading around $66, key support, recommending it felt like a contrarian bet. The stock had spent years in the slow lane – a legacy networking name that the market had largely written off while flashier AI plays grabbed the headlines.

Fast forward to now, and that bet has nearly doubled. As of Friday’s close, according to TheStreet Pro, CSCO was up 98.6% from an entry point recommended by analyst Ed Ponsi in 2024. The stock is now trading far above every major moving average, AI orders are quadrupling, and CEO Chuck Robbins just delivered record quarterly revenue.

Now, one number on the chart is flashing a signal that’s hard to ignore, and it doesn’t show up often. Cisco’s relative strength index (RSI) hit close to 90 on May 19, according to TradingView data. That’s not just overbought. That’s one of the highest readings this stock has seen in years. Back on May 12, 2026, Micron was also here, flashing 85 RSI.

Cisco’s rare RSI reading deserves serious attention

The RSI is a momentum indicator that runs on a scale of 0 to 100. Any reading above 70 is considered overbought. That’s a signal that a stock has moved faster than the underlying fundamentals can comfortably justify in the short term. However, it doesn’t guarantee a reversal, but a retracement is inevitable.

Cisco’s reading of 88.71 isn’t just above 70. It’s deep into territory where very few stocks trade for long.

My review of the chart data tells a clear story about where CSCO sits technically right now:

50-day moving average (MA): approximately $87 — CSCO is trading well above it100-day MA: approximately $82 — also well below current price200-day MA: approximately $77 — the stock has pulled dramatically away from long-term supportRSI on May 19: 88.71, among the highest readings in years, before pulling back slightly
Source: Cisco Systems on TradingView

Looking at my chart, the stock broke weekly resistance around $65 in June 2025, retested that level, and has since respected an ascending trendline, last touching it around $78 in late March and early April 2026 before surging sharply higher.

Stocks can absolutely keep climbing while overbought. Sometimes they do so for weeks. But the extremity of an RSI near 90 historically raises the probability of at least a short-term pause or pullback — and that’s the risk worth managing now.

Source: TradingView

TradingView

The fundamentals that earned Cisco’s remarkable run

To be clear, the technical warning doesn’t erase the fundamental story. Cisco clearly earned this rally.

In Q3 fiscal 2026, the company posted record revenue of $15.8 billion, up 12% year-over-year (YoY). Non-GAAP earnings per share (EPS) came in at $1.06, up 10% YoY, according to a company statement. Total product orders surged 35% YoY. AI infrastructure orders for the full fiscal year were raised to $9 billion from an earlier target of $5 billion.

“Cisco is well-positioned as the critical infrastructure for the AI era,” Robbins said in the company statement.

The numbers back that statement up:

Data center switching orders: up more than 40% YoYNetworking product orders: up more than 50% YoYCampus networking orders: up more than 25% YoY
Source: Cisco Third Quarter Earnings

For Q4 fiscal 2026, Cisco guided revenue between $16.7 billion and $16.9 billion, with non-GAAP EPS of $1.16 to $1.18, according to a company statement. Full-year fiscal 2026 guidance calls for revenue of $62.8 billion to $63.0 billion and non-GAAP EPS of $4.27 to $4.29.

Cisco also declared a quarterly dividend of $0.42 per common share, payable July 22, 2026 – a reminder that this is a business generating real cash, not just momentum.

Cisco’s relative strength index (RSI) hit close to 90 on May 19, according to TradingView data.

Bloomberg via Getty Images

Why data growth makes Cisco’s long-term story compelling

Here’s the context that matters for anyone thinking beyond the next few weeks. Cisco has been moving the world’s data since the dot-com era, and the volume of that data is almost incomprehensible.

Since 1999, global monthly internet traffic has increased by a factor of 360,000, according to TheStreet’s analysis of internet traffic data. Back then, roughly 250 million people were online. Today, an estimated 5.6 billion internet users are connected. AI is now driving the next exponential leap in data creation and movement, and Cisco’s routers, switches, and networking infrastructure sit directly in the path of all of it.

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The company quietly stepped away from its broad internet traffic forecasting in 2020, after releasing the Cisco Annual Internet Report covering 2018 through 2023. But the underlying trend hasn’t stopped. If anything, it’s accelerating.

CSCO shares are up 51.40% year-to-date and 84.66% over the past year, according to Yahoo Finance data as of May 19, 2026. The S&P 500 returned 7.42% and 23.31% over those same periods.

Here’s the game plan for managing CSCO right now

The stock and the broader market are both trading near their respective all-time highs. That’s not a reason to panic, but it is a reason to be thoughtful.

My suggested approach: Lock in some profits from the rally at current levels and leave some shares to run. Locking in some profits while keeping meaningful exposure to a stock whose AI infrastructure story remains genuinely compelling could be wise.

Selling entirely would mean betting against a fundamental tailwind that Morgan Stanley, HSBC, TD Cowen, and the company’s own order book all support. Holding everything ignores a chart that is historically stretched by almost any technical measure. At the end of the day, we all want to pay ourselves after a strong rally. Trimming splits the difference, and protecting the account is always the priority. If it pulls back, you can always consider adding back the shares that were sold

Related: HSBC nearly doubles Cisco stock price target for 2026

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