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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.
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. >>5 Huge Stocks Ready to Slingshot Higher
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 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 underway. And when there’s a big catalyst, there’s often a trading opportunity. >>5 Stocks With Big Insider Buying
Without further ado, here’s a look at four of today’s names in the tech sector.
Nearest Resistance: $20
Nearest Support: $17.50
Catalyst: Positive Earnings
First up is Cisco Systems (CSCO), the IP networking firm that’s been a mixed bag in 2012. While shares are only up 3.43% on the year as of this afternoon, that number isn’t really very telling -- shares have swung from double-digit gains to double-digit losses and back already this year. >>5 Dividend-Paying Stocks for the Next Decade
Today, they’re up more than 7% as I write after Cisco reported an income increase for the second quarter of 2012 and a dividend hike for shareholders who were willing to put their faith in this stock.
From a technical perspective, Cisco’s gap up this morning is a big deal. It shoves CSCO through the former resistance level at $17.50, a price that had been acting as a sort of ceiling for shares this summer. Right now, Cisco is smack-dab in between $17.50 and the next-highest resistance level for shares at $20.
For late-to-the-game traders, I’d recommend waiting for Cisco to test resistance before buying. Investors are fickle about this stock, and it may now be overextended.
Cisco was also highlighted earlier this week in "5 Hated Stocks Set to Soar on Earnings."
Nearest Resistance: $22
Nearest Support: $19.80
Catalyst: IPO Lockup Expiration
Facebook’s (FB) down big today? Quelle surprise. >>3 Internet Stocks Ready to Move Higher
I’m no fan of Facebook from a technical standpoint. In fact, I called the stock one of "5 Social Networking Stocks to Sell Now" at the end of July, when shares were trading around 15% higher. Today alone, they’ve slid 6.58% and I’m sticking by my call.
Today, there’s a very simple reason for the selloff in Facebook: It’s the end of the stock’s IPO lockup period, the point at which insiders can start selling their shares. Ultimately, lockups tend to be a bit of a mystery: They’re public information that’s highly anticipated, but of late they’ve crashed recent IPOs like clockwork.
With shares testing support today, Facebook could have even further to fall in the near-term. Caveat emptor.
Nearest Resistance: $7.50
Nearest Support: N/A
Catalyst: Earnings Aftermath
Groupon (GRPN) is another stock that’s getting shoved lower today, in this case simply because of the aftermath of the firm’s bad earnings call on Monday. Shares are down more than 5.6% as I write this afternoon, unable to catch a bid after plunging into new all-time lows since GRPN’s IPO. >>5 Toxic Stocks to Sell Now
Groupon is another name that I featured in "5 Social Networking Stocks to Sell Now" -- except GRPN was trading almost 30% higher back then.
I’d strongly recommend against trying to be a Groupon buyer here. While the site is known for offering consumers bargains and deals, this stock is neither right now.
Nearest Resistance: $34
Nearest Support: $32
>>10 Top-Rated Tech Stocks That Pay Big Dividends
Large-cap computer storage firm NetApp (NTAP) is enjoying some modest gains this afternoon, up around 3% after reporting earnings that fell largely in line with Wall Street’s expectations. NTAP saw its income drop materially in the firm’s fiscal first quarter, but analysts had been expecting the worst, so merely bad was an upgrade for shares.
From a technical standpoint, NetApp had been looking somewhat negative leading into earnings, showing traders a short-term inverse head and shoulders pattern with a neckline at $32. A breakdown below $32 is still a signal to short shares (albeit a very short-term signal because of the size of the pattern). Even so, earnings may be good enough to derail the negativity.
On the flipside, I’d be a buyer on a breakout above $34.
To see these stocks in action, check out the at Most-Active Stocks portfolio on Stockpickr.
-- Written by Jonas Elmerraji in Baltimore.
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At the time of publication, author had no positions in stocks mentioned.
Jonas Elmerraji, based out of Baltimore, is the editor and portfolio manager of the Rhino Stock Report, a free investment advisory that returned 15% in 2008. He is a contributor to numerous financial outlets, including Forbes and Investopedia, and has been featured in Investor's Business Daily, in Consumer's Digest and on MSNBC.com.