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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 and market data 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.

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

Rite Aid

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  • Nearest Resistance: $6.20
  • Nearest Support: $5.70
  • Catalyst: Merger Update

Rite Aid's (RAD) - Get Rite Aid Corporation Reportsaga continues. Shares of the drugstore chain are back at the top of the NYSE's most actively traded list on Monday afternoon, and are down 17% as of this writing, after the latest update on the firm's merger with Walgreens Boots Alliance (WBA) - Get Walgreens Boots Alliance Inc Report.

Walgreens will pay at least $2 billion less for Rite Aid, depending on how many stores need to be divested to gain regulatory approval for the merger. Instead of $9 per share, Walgreens will now pay between $6.50 to $7 a share for the deal.

Still, shares are trading well below that price on Monday afternoon as investors weigh in on the likelihood of the deal going through. Headline risk remains high in Rite Aid this winter.

Bank of America

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  • Nearest Resistance: $23.50
  • Nearest Support: $22
  • Catalyst: Market Correction

Bank of America (BAC) - Get Bank of America Corp Reportis correcting alongside the rest of the broad market on Monday afternoon, dropping 2.5% after a market-beating run since November. BofA has spent the last couple of months forming a textbook example of an ascending triangle pattern -- the top of that pattern is now at $23.50, a price level that, if shares can move above, signals a breakout.

While Monday's drop in BofA looks large, the big picture is still definitively bullish in this big bank.

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  • Nearest Resistance: $230
  • Nearest Support: $222.50
  • Catalyst: Market Correction

Another big security that's moving because of the worst one-day broad market correction in 2017 is the SPDR S&P 500 ETF (SPY) - Get SPDR S&P 500 ETF Trust Report -- an ETF that tracks the broad S&P 500. SPY is shedding 0.9% on high volume on Monday afternoon.

While Monday's drop is bigger than normal, it still looks like a minor correction within the context of the primary trend that's been catapulting the S&P higher for the last year.

If you're looking to add to your stock positions with a stake in SPY, wait for the correction to play out in the near-term before you buy -- but higher ground still looks likely here.


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  • Nearest Resistance: $7
  • Nearest Support: N/A
  • Catalyst: Guidance

Wearable tech maker Fitbit (FIT) - Get Fitbit, Inc. Class A Reportis selling off by 14% on Monday afternoon, following a guidance update. The company now sees its adjusted year loss falling between 51 and 56 cents a share. Previously, Fitbit had expected profits between 14 cents and 18 cents per share, and analysts were looking for a 17-cent profit, on average. The company also announced that it will cut approximately 6% of jobs in a move to fix its financials.

The update spurred a downgrade from SunTrust, which cut its price target in the firm to $8.

Technically, Fitbit's big breakdown on Monday is bad. Shares had been forming a descending triangle pattern, a bearish continuation setup that signals more downside is likely now that prior support at $7 has been violated.

Caveat emptor.

iPath S&P 500 VIX Short-Term Futures ETN

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  • Nearest Resistance: N/A
  • Nearest Support: N/A
  • Catalyst: Market Correction

The iPath S&P 500 VIX Short-Term Futures ETN (VXX) - Get iPath Series B S&P 500 VIX Short-Term Futures ETN Reportis seeing some upside on Monday afternoon, boosted as the broad market correction in the S&P fuels an increase in volatility. Despite the pop on Monday, the overall trend in VXX remains squarely down and to the right -- and that means that investors should steer well clear of VXX in 2017.

An important note about this exchange-traded note is the fact that VXX doesn't have conventional support and resistance levels like a normal stock. Since the price action in VXX is determined by a statistical formula, not directly supply and demand from market participants, it's important not to try to use conventional technical tools on this unique exchange traded note.

But, as long as the uptrend in the S&P remains intact, you don't want to own VXX.

Tempur Sealy International

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  • Nearest Resistance: $47.50
  • Nearest Support: N/A
  • Catalyst: Contract Loss

$2.4 billion bedding manufacturer Tempur Sealy International (TPX) - Get Tempur Sealy International Inc Reportis in freefall on Monday afternoon, down 32% as I write, following the announcement that the firm had lost contracts for all of its product lines with retailer Mattress Firm Holdings (MFRM) . Mattress Firm had been seeking price concessions, and the two companies couldn't agree to changes to supply agreements.

From a technical standpoint, Monday's big selloff is as material as it seems. Shares had been in a long-term downtrend, but the fact that Tempur Sealy is violating the bottom of its wide-ranging trend channel isn't a good sign. It means that there's no meaningful support level to act as a floor for the selling.

Investors should wait for TPX to establish some semblance of support again before thinking about getting on the long side of this stock.


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  • Nearest Resistance: $19.65
  • Nearest Support: $19.35
  • Catalyst: Acquisition

Small-cap tech company Ixia (XXIA) is getting attention as one of the most actively traded names on the Nasdaq on Monday afternoon, boosted following acquisition news. Keysight Technologies (KEYS) - Get Keysight Technologies Inc Reportis acquiring the network testing and security company for $1.6 billion in cash, a deal price that will pay shareholders $19.65 per share.

That price tag represents about a 45% premium over where shares traded back in December, when news first surfaced that Ixia was up for sale. At this point, the money has already been made on the Ixia trade. Shares are just about at their purchase price as I write.

At the time of publication, author had no positions in the stocks mentioned.