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5 Social Networking Stocks to Sell Now

Stocks in this article: GRPN SOHU ZNGA FB SINA

Groupon

We'll start off with Groupon (GRPN), a stock that's sort of exemplified Wall Street's disappointment with social media stocks. This Internet deal site went public in the biggest internet IPO since Google (GOOG) back in November, pricing at $20 per share and falling like a rock ever since thanks to a combination of fundamental and technical factors.

With especially ugly technicals shaping up right now, I'd suggest selling this stock.

Groupon formed a bearish descending triangle pattern for most of the summer, bouncing in between a horizontal support level and downtrending resistance. Essentially, as shares volleyed between those two price levels, they were getting squeezed closer and closer to a breakdown below support. That breakdown happened at the start of July, spurring a sell signal in shares.

>>2 Dividend Stocks to Sell for Profits

And Groupon is showing no signs of finding bottom yet. Momentum, measured by 14-day RSI, has been in a solid downtrend since the start of 2012. Since RSI is a leading indicator of price, that means Groupon is in "sell mode" right now. I'd advise you do the same.

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