Alphabet Inc. (GOOGL) (GOOG) stock is waving a red flag that technical traders recognize instantly: the relative strength index has blasted past 79, deep into what chartists call extremely overbought territory.

According to data from market intelligence sources, both share classes of Alphabet clocked RSI values above 79 on Tuesday morning. In the world of technical analysis, that's traditionally the market's way of saying "slow down." When prices climb this fast, the textbook expectation is a short-term pullback or consolidation as traders cash in their gains.

But here's where it gets interesting. Alphabet isn't rallying on hype alone. The surge is backed by some genuinely substantial fundamental catalysts that complicate the straightforward technical sell signal.

The momentum started building around the launch of Gemini 3, Google's most advanced AI model yet. Analysts are genuinely impressed, noting it holds a competitive edge over OpenAI's ChatGPT. That alone would be enough to get investors excited, but there's more.

Add reports of a multi-billion dollar deal to rent Alphabet's custom tensor processing units to Meta Platforms Inc. (META), then sprinkle in the news that Warren Buffett's Berkshire Hathaway recently disclosed a stake in the company. Suddenly you've got a pretty solid foundation for investor conviction, overbought technicals be damned.

So what should investors make of this tension between technical warnings and fundamental strength? While the chart setup certainly favors a cooling-off period—perhaps a dip to test key moving averages—these strong fundamentals could allow Alphabet to stay "overbought" far longer than purists would expect.

For those looking to add positions or manage existing ones, that RSI above 79 suggests planning your entries carefully rather than chasing. The clearer pullback signal would be the RSI crossing back below 70, which would confirm that the short-term euphoria has actually subsided rather than just paused.

For now, Alphabet's bull run continues, with AI-driven fundamentals essentially overpowering the overbought technical signal. Smart money will be watching both the price action and that critical 70-level RSI crossover to determine whether a meaningful pullback is actually coming or if this rally has more room to run.