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3 Big Stocks on Traders' Radars - views
-- 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: $24
Nearest Support: $21.50
Catalyst: Outlook Beat
Computer maker Hewlett-Packard (HPQ) is managing to skirt broad selling today after the firm's earnings call included guidance that brought buyers back out. HP saw its quarterly earnings drop again this past quarter, but planned third-quarter profits between 84 cents and 87 cents per share came in above the 83 cents that Wall Street analysts were expecting.
Today, HP is testing resistance at the $24 level. While the stock is 20 cents above that level as I write today, I'm not quite ready to register HPQ's price action as a breakout. The move just isn't material at this point.
If HPQ can get some continuation in tomorrow's session, traders should consider it a buy signal. Don't touch HPQ until that $24 level gets definitively taken out.
Nearest Resistance: $52
Nearest Support: $48
Catalyst: Technical Breakdown
Citigroup (C) is getting hefty trading volume today after shares of the big bank gapped down on technical weakness this morning. But just like the broad market, Citi is melting up over the course of today's session. That could spare the stock from what looked like a sell signal in shares at the open today.
Citi has been trending higher over the course of 2013, buoyed by broad market strength that trickled down to the firm's own performance. Year-to-date, Citi has seen its share value climb by nearly 30%, a run that's bested the S&P 500 by a factor of two. While it looked like Citi was breaking uptrending support this morning, today's melt up may shove shares back up above support before the close. I wouldn't recommend betting against this stock just yet.
Nearest Resistance: $12.50
Nearest Support: $12
Catalyst: Buyout Offer Change
Pharmaceutical firm Elan (ELN) is up around 3% as I write today, following news that suitor Royalty Pharma was reducing number of votes it needed to proceed with a hostile takeover of Elan. Royalty is dropping its acceptance condition to 50% and one share -- all it needs is to secure a majority vote. That greatly increases the likelihood that shareholders will green light the $12.50 per share buyout offer.
Buyouts typically box-in the target stock's support and resistance levels right around the offer price -- and while there's more of a risk premium still left in Elan's shares than the norm, most of the upside has already been tapped in this stock.
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 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
Follow Jonas on Twitter @JonasElmerraji