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3 Big Stocks to Trade (or Not) - views
BALTIMORE (Stockpickr) -- Put down the 10-K filings and the stock screeners. It's time to take a break from the traditional methods of generating investment ideas. Instead, let the crowd do it for you.
From hedge funds to individual investors, scores of market participants are turning to social media to figure out which stocks are worth watching. It's a concept that's known as "crowdsourcing," and it uses the masses to identify emerging trends in the market.
Crowdsourcing has long been a popular tool for the advertising industry, but it also makes a lot of sense as an investment tool. After all, the market is completely driven by the supply and demand, so it can be valuable to see what names are trending among the crowd.
While some fund managers are already trying to leverage social media resources like Twitter to find algorithmic trading opportunities, for most investors, crowdsourcing works best as a starting point for investors who want a starting point in their analysis. Today, we'll leverage the power of the crowd to take a look at some of the most active stocks on the market today.
These "most active" names are the most heavily-traded names on the market -- and often, uber-active names have some sort of a technical or fundamental catalyst driving investors' attention on shares. That's especially true now that earnings season is officially underway. And when there's a big catalyst, there's often a trading opportunity.
Without further ado, here's a look at today's stocks.
Nearest Resistance: $7.62
Nearest Support: $6.75
Catalyst: Nokia X Leak Hangover
Nokia (NOK) is down nearly 3% this afternoon, a hangover of sorts from leaks over the Android-powered Nokia X handset speculated to be released to emerging markets. Shares of NOK moved up hard on the news late last week, but they've settled lower this week.
There are a lot of reasons to be avoiding Nokia right now. The firm is selling a massive chunk of its assets to key partner Microsoft (MSFT), for instance, and its "holdover" operations aren't completely clear. Likewise, shares look likely to re-test support at the $6.75 level in the near-term.
If NOK can't catch a bid at that price in the coming sessions, lower ground looks very likely. If shares do bounce off of $6.75, the 50-day moving average is the breakout level to watch for a buy signal. For now, Nokia is still in a downtrend.
Nearest Resistance: $17
Nearest Support: $15
Catalyst: Q4 Earnings
Shares of Western Union (WU) are getting some high volume buying action this afternoon, the result of expected earnings and positive guidance for the fourth quarter. Western Union announced that it earned 31 cents per share for the quarter, a cent shy of Wall Street's consensus estimate, but it also said that hefty compliance costs to avoid money laundering were likely to drop in the quarters ahead. Shares are up more than 2% on the news.
But don't get too excited about WU's gap up this morning. As of this afternoon, shares are hitting their head on a long-standing trendline resistance level that's acted as a price ceiling twice in the past. Until shares can break out topside, stay far away from the long side of WU.
Nearest Resistance: $56.50
Nearest Support: $50
Catalyst: Technical Setup
It should come as no big surprise that Twitter (TWTR) is making our list of the most active stocks today. The microblogging service is up 4.6% this afternoon, the result of a technical bounce in shares after being seriously oversold following the firm's earnings call last week. While today's push higher looks auspicious, it's not buyable -- shares are testing a key resistance level this afternoon.
Twitter is currently pushing up against resistance at $56.50, a level that was prior support for shares between December and the start of February. A breakout above that price ceiling would be a strong buy signal in the next session or two. An open above $56.50 is confirmation that buyers have absorbed any selling pressure that's lingering up there.
To see these stocks in action, check out the at Most-Active Stocks portfolio on Stockpickr.
-- Written by Jonas Elmerraji in Baltimore.
At the time of publication, author had no positions in the stocks mentioned.
Jonas Elmerraji, CMT, is a senior market analyst at Agora Financial in Baltimore and a contributor to TheStreet. Before that, he managed a portfolio of stocks for an investment advisory returned 15% in 2008. He has been featured in Forbes , Investor's Business Daily, and on CNBC.com. Jonas holds a degree in financial economics from UMBC and the Chartered Market Technician designation.
Follow Jonas on Twitter @JonasElmerraji