Super Micro Computer Inc. shares continued their rocket ride higher on Wednesday, and are starting to act like they did during their meteoric rally in early 2024. And that's likely to be good news for bulls.

The server maker's stock $(SMCI)$ powered up Wednesday by as much as 19.1% in intraday trading, before paring gains to close up 8%, at a six-month high of $60.25 per share. The stock has soared 56% amid a five-day win streak.

Super Micro shares have run up 111.3% so far this month - which puts them on track, with seven sessions to go, for their best monthly performance since the May 2023 record rally of 112.4%. The sudden strength in the stock comes amid growing optimism over the company's potential to win some big artificial-intelligence server deals.

That kind of historic rally comes with some technical consequences. It has pushed the stock's relative strength index, or RSI - a widely followed momentum measure - to the highest level seen in a year.

When an RSI gets above 70, it suggests an "overbought" condition. Being overbought means that a stock or index has rallied so far and so fast, relative to its historical behavior, that it needs to take a breather before it can continue. On Wednesday, Super Micro's RSI climbed to 80.38.

But in practice, "overbought" is often a misnomer, because there are many cases in which becoming overbought appears to be more of an ability than a condition. Basically, becoming overbought can be a sign of underlying strength.

As the chart above shows, after the last three times that Super Micro's RSI first rose above 80 during a rally, the stock continued to climb.

The last time it happened, the RSI closed at 80.5 on Jan. 23, 2024, after the stock soared 47% in three days. The stock rose in 15 of the next 17 sessions for a gain of 119.5% during that period, before suffering a significant pullback.

On another bright note, Super Micro's stock closed above its 200-day moving average, which many view as a long-term trend tracker, for a second straight day Wednesday. The last time the stock saw back-to-back closes above its 200-DMA was Aug. 1, 2024.

Some upside levels to watch include previous support, which likely has morphed into resistance, at around $71, followed by previous resistance at the May-through-July closing highs in the $90 to $95 range.