4 Stocks Trading on Big Volume -- and What You Should Do With Them Now

These stocks are seeing increased trading volume today. Here's how to trade them 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.

Pfizer

  • Nearest Resistance: $36
  • Nearest Support: $32
  • Catalyst: Technical Setup

Pharma giant Pfizer (PFE) - Get Report  is seeing big volume for technical reasons this afternoon, as shares test a key support level at $32.

Pfizer has spent the month of November correcting, but that correction comes within the context of a new uptrend in shares. Because that uptrend is still pretty new, it's particularly important for buyers to wait for a bounce off of $32 support before trying to jump into this trade. From here, the next resistance level in Pfizer's trend channel is up at $36.

Intel

  • Nearest Resistance: $38
  • Nearest Support: $32
  • Catalyst: Technical Setup

Intel (INTC) - Get Report  is in rally mode this week, drawing big volume as it bounces off the bottom of its own uptrending channel. Intel has spring-boarded nearly 9% so far this week, gaining some extra momentum in a big move yesterday, following comments from the firm's CEO about reducing mobile losses by nearly $1 billion and boosting server CPU growth by 40%.

Shares are hitting fresh highs on big volume this afternoon as Intel makes its way up to the top of the channel. The 50-day moving average has started acting like a good proxy for support, and that makes it a logical place for buyers to park a protective stop.

Mentor Graphics

  • Nearest Resistance: $24
  • Nearest Support: N/A
  • Catalyst: Q3 Earnings

One semiconductor firm that's not participating in the industry's rebound this month is Mentor Graphics (MENT) . This stock is getting shellacked this afternoon, down more than 31% following the release of its third quarter earnings results. Mentor earned profits of 28 cents per share, only missing analyst estimates by a penny -- but the firm expects a rough fourth quarter, with earnings forecast to come in at 47 cents per share, about half the profit that Wall Street was expecting for the quarter.

From here, Mentor's chart looks broken. Shares had been in a long-term uptrend for most of 2015, but Mentor violated key support just above $24 on this morning's gap down. That big support break opens up Mentor Graphics to more potential downside risk this fall.

Nimble Storage

  • Nearest Resistance: $22
  • Nearest Support: N/A
  • Catalyst: Q3 Earnings

Computer storage stock Nimble Storage (NMBL)  isn't quite living up to its name this afternoon. Shares are plummeting almost 50% today following third-quarter earnings results. Nimble reported a worse-than-expected adjusted loss of 14 cents per share for the quarter, and it announced forecast revenues and profits for the fourth quarter that were materially below analysts expectations.

Put simply, buyers have dried up for Nimble this afternoon. The first sign of lack of demand actually came earlier this month, when this stock violated a major support level at $22. Now, with negative fundamentals announced, and no buyers to be found, today's huge gap lower in Nimble Storage isn't a huge surprise. Shares are at all-time lows this afternoon, but it could set some new downside records in the near-term.

Jim Cramer agrees that investors should avoid Nimble. He prefers Salesforce.com (CRM) - Get Report .

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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