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5 Toxic Stocks That Are Poisoning Your Portfolio

Frontier Communications

The last six months, on the other hand, have been pretty rough for $4 billion communications stock Frontier Communications (FTR - Get Report). Shares have slid nearly 10% over the time, underperforming the broad market's move higher by close to 20%. But you don't have to be an expert technical analyst to see why shares look likely to keep on moving lower.

FTR has been in a well-defined downtrend since the end of the summer. It's significant that FTR's trading channel is well defined; it means that we've got a high-probability range for shares to keep moving within. So now, with shares sitting near the middle of the channel, there's considerable room for TRQ to move lower before they can catch a bid again. Maybe worse, there's also a ton of room that this stock can move higher without actually breaking its downtrend. That fact could lure in more unsuspecting buyers only to have shares keep bouncing between trendline resistance and support.

I'd recommend avoiding this stock altogether until it exits its channel.

To see this week's trades in action, check out the Technical Setups for the Week 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, CMT, is a senior market analyst at Agora Financial in Baltimore and a contributor to
TheStreet . Before that, he managed a portfolio of stocks for an investment advisory returned 15% in 2008. He has been featured in Forbes , Investor's Business Daily , and on CNBC.com. Jonas holds a degree in financial economics from UMBC and the Chartered Market Technician designation.
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SYM TRADE IT LAST %CHG
FTR $4.59 0.00%
FL $68.81 -0.89%
HEI $54.18 0.00%
TEN $48.79 0.00%
USAP $14.17 0.00%

Markets

Chart of I:DJI
DOW 17,568.53 -127.94 -0.73%
S&P 500 2,079.65 -12.01 -0.58%
NASDAQ 5,088.63 -48.8540 -0.96%

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