Cloud stocks hit records for a fifth day in a row.
The SKYY cloud computing ETF notched an all-time high Monday, the latest in what has been a year-long rally fueled by the pandemic and a shift to remote work.
Ari Wald, head of technical analysis at Oppenheimer, said Monday the gains should continue.
"These stocks possess momentum. They score very high in our work, and we've been making the point that this is actually the point in the equity cycle when momentum reasserts its leadership," Wald said on CNBC's "Trading Nation." "We like high momentum, and I think these stocks go along [for] the ride."
But after the rally, Wald said, some of the stocks have become slightly overbought, with one exception.
"One that does stand out playing the rotation game is Smartsheet. It is resuming what we see as a very important breakout that started in the fourth quarter," said Wald.
Smartsheet, a company with a $9 billion market cap, has rallied nearly 150% off its March low. The stock also hit records on Monday.
The past year may have just accelerated a development long in the making, according to Gina Sanchez, CEO of Chantico Global and chief market strategist at Lido Advisors.
"This is actually one that was a trend that was already established before the pandemic began. The move to cloud computing was really being brought on by just the massive amounts of data that we're collecting from everything from Internet of Things — everything from your phone to your thermostat," Sanchez said during the same interview.
Disclosure: Sanchez and Lido hold MSFT.