NEW YORK (TheStreet) -- Anyone who spends time in the financial markets quickly learns that everything about an efficient market learned in school can get thrown out the window.
Some may question the use of and utility of technical analysis. Technical analysis gets a bad rap because so many "gurus" haven't put the time or the effort needed into learning the difference between a pattern and what is random noise. A sure sign of weakness is someone giving advice without knowing the odds and expected edge.
Technical analysis is like sex: Most think they perform a lot better at it then they really do. If someone says "this stock is good/bad because of _________(add reason here)," ask them how many other similar situations like the current one they have back tested and what is the odds, risk and edge. If all you hear is crickets in the background, you will know how much weight to give the advice.
Here is a list of six stocks that are oversold on the weekly charts. My preferred method to exploit the weakness is to sell put options or write covered calls (pretty much the same thing). The average trade lasts three to four weeks. I am boring, so I like selling time premium, but others have successfully adjusted and use call options to liven up the party.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass + 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV