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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.
Cliffs Natural Resources
Nearest Resistance: $22
Nearest Support: $20
Catalyst: Earnings Beat
On the other side of the spectrum is Cliffs Natural Resources (CLF). Cliffs is up nearly 18% as I write today, buoyed by an earnings announcement that trounced Wall Street’s bearish expectations. Cliffs earned 66 cents per share in the first quarter, besting the consensus estimate of 32 cents. While commodity-driven names like Cliffs have been under significant pressure in the last half year, CLF managed to pull off a good recovery this quarter -- and the price action points to more upside ahead.
The move higher today in CLF is pushing shares right up against an important resisatnce level at $22. In the past, there’s been enough selling pressure at that $22 level to absorb any bids getting tossed around by buyers. If shares can print above that price this time around, traders should take it as a buy signal. Keep a close eye on CLF this week.
MPG Office Trust
Nearest Resistance: $3.20
Nearest Support: $3.10
Catalyst: Acquisition Offer
Small-cap real estate investment trust MPG Office Trust (MPG) may be a stranger to the volume it’s seeing today -- but the acquisition offer the firm received from a unit of Brookfield Office Properties (BPO) is enough to make the trust one of the most actively traded stocks on the NYSE this afternoon. BPO’s $3.15 per share offer ratcheted MPG more than 20% above yesterday’s closing price this morning, and now shares are keeping close to that offer price.
For investors who missed the gun, though, there isn’t an opportunity here anymore.
Nearest Resistance: $23
Nearest Support: $25
Catalyst: Mixed Earnings Results
Finally today, Safeway (SWY) is getting sold off today after the grocer posted first-quarter numbers that Wall Street wasn’t impressed by. While Safeway’s earnings met the consensus estimates for the firm, it clearly wasn’t enough to appease investors – and the stock is down more than 18% as a result. The drop comes just days after the IPO of Safeway’s BlackHawk (HAWK) gift card unit spurred shares higher.
Now Safeway is looking rough from a technical analysis standpoint. While the firm does have a decent support level at $23 to rest on, this massive breakdown shattered the uptrend in shares that’s been in place since all the way back in November. More downside looks like the likeliest outcome in the near-to-mid-term.
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.