BALTIMORE (Stockpickr) -- Over the last few months, I've made it no secret that I like stocks. From both a technical and a fundamental standpoint, the evidence is mounting for a sustained bullish move in the market -- and the rally that we've been in since June is just the first act. But that's exactly why you need to shed the toxic stocks from your portfolio in October.
Toxic stocks are the names that haven't participated in the rally so far, sending an ominous message to investors. After all, you don't want to own the names that can't catch a bid when the market's moving 15% higher. To take full advantage of a bullish move in stocks, knowing which stocks to avoid is more than half the battle.
That's why, today, we're taking a technical look at five names that could be toxic for your portfolio this fall.To be fair, the companies I'm talking about today aren't exactly "junk." I mean, they're not next up in line at bankruptcy court -- and, in fact, I even like a couple of this week's names fundamentally. But that's frankly irrelevant; from a technical analysis standpoint, they're some of the worst positioned names out there right now. For that reason, fundamental investors need to decide how long they're willing to take the pain if they want to hold onto these firms this Fall. And for investors looking to buy one of these positions, it makes sense to wait for more favorable technical conditions (and a lower share price) before piling in. >>5 Stocks Hedge Funds Love -- and So Should You For the unfamiliar, technical analysis is a way for investors to quantify qualitative factors, such as investor psychology, based on a stock's price action and trends. Once the domain of cloistered trading teams on Wall Street, technicals can help top traders make consistently profitable trades and can aid fundamental investors in better planning their stock execution. So without further ado, let's take a look at five "toxic stocks" you should be unloading in October.
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 Plus 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