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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: $19
Nearest Support: $16
Catalyst: Brazilian Fuel Price Increases
Brazilian oil giant Petrobras (PBR) is rallying around 5% today after hiking wholesale diesel prices in Brazil by the same amount. All in, shares of the supermajor have climbed more than 20% since Tuesday on concerns over Brazilian inflation -- a potentially big factor in boosting PBR’s earnings in 2013. But the move is significant from a technical level as well.
That’s because PBR has been selling off hard in the last year, down more than 38% in the trailing 12 months even with this week’s bounce. But the bounce could have longer-lasting consequences, especially if it can propel shares through the trendline resistance level that’s been acting as a sort of price ceiling for shares. A move through $19 resistance would be the signal that Petrobras is making a change in trend.
Mitsubishi UFJ Financial Group
Nearest Resistance: $5.80
Nearest Support: $5.50
Catalyst: M&A Deal, Technical Setup
$80 billion Japanese bank Mitsubishi UFJ Financial Group (MTU) may be correcting by around 2% today, but zoom out a bit and its price action looks a bit more auspicious. MTU is seeing large volume today following strength in Japan’s Nikkei this week. The Japanese index has been showing some significant technical strength for the past few months, and ADR investors are using MTU as a way to get exposure to the hot market.
From a technical standpoint, MTU is currently looking bullish, with an ascending triangle setup showing up in shares in the near-term. Resistance at $5.80 is the price level that needs to be cracked before the pattern signals a buy -- and it’s the place I’d recommend investors jump in for the lowest-risk entry.
Cemex SAB de CV
Nearest Resistance: N/A
Nearest Support: $11
Catalyst: New Highs
Cemex (CX) is getting significant attention in today’s trading session as shares push through to new mult-year highs. That makes CX yet another foreign name that’s getting significant trading attention on the NYSE this afternoon. While it may seem surprising, new highs are often a reason for traders’ attention in and of themselves.
Making new highs is significant from an investor psychology standpoint because it means that everyone who has bought shares in the last year is sitting on gains. As a result, the “back to even” mentality is less of a concern than it would be for a name with a higher proportion of shareholders sitting on losses. For late-to-the-game buyers though, I’d recommend sitting on the sidelines until CX pushes above today’s high water mark.
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.