Trifecta Stocks is a long-only model portfolio, but we are anxious to
give our subscribers insight into stocks that may pose interesting
investing opportunities on the short side.
Using recent actions and grades from Quant Ratings and layering on
technical analysis of the charts of those stocks, we will identify a few
names each Friday that look bearish. While we will not be weighing in
with fundamental analysis, we hope this piece will give investors
interested in stocks on the way down a good starting point to do
further homework on the names.
CAT was recently downgraded to Hold with a C+ rating by The Street’s Quant Ratings.
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The big industrial Caterpillar has been awful for months with high
volume selling, technical breakdowns and awful relative strength.
While the March low could be considered support, we would say any
rally to fill the gap at $80 should be sold here or shorted. Indicators are
This Chinese internet game service company was recently
downgraded to Sell with a D+ rating by The Street’s Quant Ratings.
You would be hard pressed to find a strong Chinese stock out there.
Most have come in hard as the Shanghai Index has tumbled into a
bear market. China stocks have suffered mercilessly, and Sohu was
stripped of big value. We see the decline is a waterfall type with big
volume coming in throughout July. With a three-day rally, this is still
not anything that can be bought.
Weibo Corp. (WB:Nasdaq)
The Chinese social media company was recently downgraded to Sell with a D+ rating by The Street’s Quant Ratings.
Weibo is another Chinese name [spinoff from Sina (SINA:Nasdaq)] that
has also fallen hard but may have found some support. The recent rally
off the lows suggests a turn could happen, but the indicators are still
quite bearish. Until the 200-day Moving Average is recaptured at
$15.70, any rally should be sold.
Teekay Corp. (TK:NYSE)
This big shipping company was recently downgraded to Hold with a C rating by The Street’s Quant Ratings.
TK has been in a downward spiral since late spring and has done a
swan dive since mid July. There are just no buyers here and while a
few days saw a bit of a rally, there is just too much resistance and
sellers above. Resistance at $39, sell rallies.
Mondelez International's chart shows bullish momentum and volume.
A robust reversal is turning momentum bullish.
Earnings season has been bumpy for the portfolio this week, while volatility in China remains a concern.
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