The biggest name on this list is Verizon ( VZ). The $150 billion telecom stock is one of two standard bearers in the wireless and fixed line phone business -- but I'm not here to trumpet Verizon's successes today. Shares look "toppy" in the short-term.
Sure, Verizon has posted some strong performance this year. Shares of the carrier are up more than 20% since the calendar flipped over to 2013. But now, a head and shoulders pattern points to a top in the massive telco. The head and shoulders is a price pattern that indicates exhaustion among buyers. The pattern is formed by two swing highs that top out around the same level (the shoulders), separated by a bigger peak called the head; the sell signal comes on the breakdown below the pattern's "neckline" level, currently right below $52.Momentum, measured by 14-day RSI, adds some extra downside confidence to this trade. The long-term uptrend in momentum broke in yesterday's session. To be clear, this is a short-term setup; even so, longer-term investors looking to build a position in VZ would be wise to wait for it to find a new lower support level first.
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