4 Giant Stocks to Add to Your Buy List

Here's a technical look at how to trade some of the most active stocks on the market right now.
By Jonas Elmerraji ,

Put down the 10-K filings and the stock screeners. It's time to take a break from the traditional methods of generating investment ideas. Instead, let the crowd do it for you.

From hedge funds to individual investors, scores of market participants are turning to social media to figure out which stocks are worth watching. It's a concept that's known as "crowdsourcing," and it uses the masses to identify emerging trends in the market.

Crowdsourcing has long been a popular tool for the advertising industry, but it also makes a lot of sense as an investment tool. After all, the market is completely driven by the supply and demand, so it can be valuable to see what names are trending among the crowd.

While some fund managers are already trying to leverage social media resources like Twitter to find algorithmic trading opportunities, for most investors, crowdsourcing works best as a starting point for investors who want a starting point in their analysis.

Today, we'll leverage the power of the crowd to take a look at some of the most active stocks on the market.

SPDR S&P 500 ETF

  • Nearest Resistance: N/A
  • Nearest Support: $205
  • Catalyst: New Highs

The S&P 500 is hitting new all-time highs this week, and that's translating into new highs and big volume in the SPDR S&P 500 ETF (SPY) - Get Report . SPY mirrors the price action in the S&P -- so as the big index goes, so too does this big $188 billion exchange-traded fund.

From a technical standpoint, the S&P has resumed its uptrend this summer, with shares pushing their way to the top of their price range as of this writing. As long as that price channel remains intact, today won't be the last record high day for the S&P in July.

Bank of America

  • Nearest Resistance: $16
  • Nearest Support: $12.50
  • Catalyst: Technical Setup

Perennially high-volume stock Bank of America (BAC) - Get Report  is seeing another active trading session of its own today, up a little over 1% for technical reasons. Bank of America is rallying off of a long-term trend line of its own this afternoon, pushing off of a price floor that's been in play since shares originally bottomed back in February.

From here, Bank of America looks well-positioned for a new test of the top of its wide price range. The next meaningful resistance level comes into play up at $16.

United States Steel 

  • Nearest Resistance: $20
  • Nearest Support: $16.50
  • Catalyst: Metals Prices

United States Steel (X) - Get Report  is another metals producer that's seeing a big-volume pop this afternoon. Shares of U.S. Steel are up more than 4% to start the week, as of this writing.

Long-term, U.S. Steel is still looking very bullish, moving up to test long-term resistance up at $20. If shares can muster the strength to break above that $20 level, then U.S. Steel becomes very likely to kick off a second leg higher this summer.

Nvidia

  • Nearest Resistance: N/A
  • Nearest Support: $47.50
  • Catalyst: Technical Setup

Finally, tech company Nvidia (NVDA) - Get Report  is up 3% on big volume this afternoon, breaking to new highs alongside the rest of the market.

Outperformance is nothing new at Nvidia. This $29 billion graphics hardware company has rallied almost 60% year-to-date, bouncing its way higher in a parabolic uptrend. This week's upside move is coming as shares bounce off of the bottom of that uptrend for the fifth time since last fall.

Even though Nvidia has moved quite a bit higher in 2016, buyers are clearly still in control of the price action at this point. For traders who aren't risk-averse, that makes Nvidia a great example of a stock to "buy the dips" on.

Disclosure: This article is commentary by an independent contributor. At the time of publication, the author held no positions in the stocks mentioned.

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