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. Today we'll leverage the power of the crowd to take a look at some of the most active stocks on the market.
It's a concept that's known as "crowdsourcing," and it uses the masses to identify emerging trends in the market.
Big picture, the stock market averages are correcting modestly this afternoon. The S&P 500 Index is off by 32 basis points as I write, with 350 S&P components lower now. While volatility is generally very low, there's no shortage of large stocks that are teetering on the verge of breakout territory Tuesday. That's particularly true in the perennially high-volume stocks we're taking a look at today.
More importantly, those market-moving narratives are creating trading opportunities for investors who are paying attention.
Meanwhile, Jim Cramer isn't buying Apple here, and says Facebook and Alphabet look better on a dip.
Advanced Micro Devices Inc.
- Nearest Resistance: $15
- Nearest Support: $11
- Catalyst: Technical Setup
Up first on the list today is chipmaker Advanced Micro Devices Inc. (AMD) - Get Report. AMD has been a breakneck performer over the course of the last year, rallying more than 146% in that trailing 12-month timeframe. Despite the sheer size of that rally, the price action indicates that AMD might have more upside ahead from here. Shares are charging just over 5% higher this afternoon, thanks to a strong technical setup that's in play today.
AMD has been bouncing its way higher in a well-defined uptrend since last summer. The lower bound of that uptrending channel has provided a low-risk buying opportunity all the way back to last July -- and shares are bouncing higher off of support for a ninth time this week. From here, look for a run toward trendline resistance up at $15 for AMD. The 200-day moving average has started acting like a decent proxy for trendline support in recent months -- that makes it a logical place to park a protective stop, if you decide to buy the bounce in AMD today.
U.S. Oil Fund
- Nearest Resistance: $9.25
- Nearest Support: N/A
- Catalyst: Crude Oil
Oil prices are moving Tuesday, and not in a good way for commodity bulls. The U.S. Oil Fund (USO) - Get Reportis one of the easiest ways for retail investors to get direct exposure to oil prices, and that's made it one of the highest-volume issues on the NYSE this afternoon. USO is down 2.6% as of this writing. Meanwhile, the energy sector as a whole is dropping today, with Chesapeake Energy (CHK) - Get Reportand Whiting Petroleum (WLL) - Get Reportleading their peers in trading volume, down 3% and 7%, respectively.
From a technical standpoint, USO hasn't been a particularly attractive stock for a while now. This ETF has been stuck in a well-defined downtrend since the start of the year, and they violated their long-term summer-2016 support level with Monday's close. With that line in the sand crossed, USO just opened up more downside risk. Caveat emptor.
Ford Motor Co.
- Nearest Resistance: $11.50
- Nearest Support: $11
- Catalyst: Factory Investment, China Imports
Ford Motor Co. (F) - Get Report is in investors' crosshairs this afternoon, down 0.49% on huge volume following a pair of major updates this morning. Ford plans on investing $900 million in its Kentucky truck plant, securing jobs for approximately 1,000 hourly workers. At the same time, Ford also said that it will export vehicles from China to the U.S. for the first time beginning in 2019 when the firm will move production of its Focus model to China.
Don't let today's modest drop in shares fool you. Ford's share price has been under pressure for much of 2017, but this stock is finally starting to look "bottomy" in the long term. Shares have been forming a textbook example of an inverse head-and-shoulders pattern, a price setup that triggers a buy with a push through $11.50. A move through that $11.50 price level is the signal that buyers have taken back control of shares.
- Nearest Resistance: $42
- Nearest Support: $39
- Catalyst: Analyst Downgrade
Last on our list of big-volume stocks is media giant Comcast Corp. (CMCSA) - Get Report. Comcast is getting attention after analyst Craig Moffett at MoffettNathanson downgraded the stock, pointing to cord-cutting as a threat to Comcast's business. The cut brings the firm's rating on Comcast to "neutral", keeping Comcast's price target at $45. Shares are sliding 2.9% on the news.
While Comcast is down, it's not out. Comcast has been bouncing higher in an uptrending channel since mid-November, and that uptrend is still very much intact now. Look for a retracement to trendline support as a buying opportunity in Comcast, not a cause for concern.
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At the time of publication, author had no positions in the stocks mentioned.