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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.
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.
Ford Motor Co.
Nearest Resistance: $11.20
Nearest Support: $10.60
Catalyst: Q3 Results, Mulally News
Shares of Ford Motor Co. (F) are swinging in a wide range this afternoon following a barrage of fundamental data and news that the firm's CEO, Alan Mulally, will stay on at the Detroit automaker through 2014. Ford booked the best October car sales in more than a decade this morning, prompting more buying after yesterday's earnings release launched shares more than 7.7% in yesterday's trading session. While shares are giving back a bit today, they're not at risk of reversing those gains.
Ford's earnings sparked a big gap higher at yesterday's open, sending shares through previous resistance at $10.60 – now, that price is acting as a support level for shares. While that breakout makes Ford buyable here, shares are still a lot closer to their next resistance
level at $11.20 than they are to that support level; that means there's a lot of risk in buying now. I'd recommend waiting for that risk to
diminish before jumping onboard.
JDA Software Group
Nearest Resistance: $45
Nearest Support: $44.75
Catalyst: RedPrarie Acquisition
Meanwhile, shares of enterprise software firm JDA Software Group (JDAS) are getting a lot of trading volume this afternoon after the firm announced that it was going private in a $1.9 billion acquisition by rival RedPrarie. The news has JDA up more than 17% as I write, a number that's not likely to change much as the trading session progresses. The acquisition deal is effectively putting a tight fundamentally driven support and resistance level on shares of JDAS, which means that there isn't a trade to be made here unless you already own JDAS.
RedPrarie is buying JDAS for $45 per share, which means that the risk premium priced into this stock works out to a measly 0.5% right now.
Research in Motion
Nearest Resistance: $11
Nearest Support: $8.50
Catalyst: BlackBerry 10 News
Research in Motion (RIMM) is Wall Street's whipping boy no more. The Ontario-based mobile device maker is up more than 8.5% today on news that its BlackBerry 10 platform is ready to launch in the first quarter of 2013. RIMM's BlackBerry line ruled the high-end handset market until Apple (AAPL) stormed in with the wildly successful iPhone, and RIMM has been struggling to recapture lost ground ever since. The good news on the BlackBerry 10 has investors hoping that they’ll see revenues move higher again.
From a technical standpoint, RIMM looks great. That's because it managed to break out above $8.50 resistance on today's news. $8.50 had previously been a price ceiling where sellers had been more eager to sell and get out of a losing position than buyers were to step in and start buying. The breakout above $8.50 proves that RIMM can still catch a bid here.
To see these stocks in action, check out the Most-Active Stocks portfolio on Stockpickr.
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.