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.
- Nearest Resistance: $70
- Nearest Support: $59
- Catalyst: Jobs Numbers
First on our list of the market's most actively-traded stocks is $172 billion banking giant Citigroup (C) - Get Report. Citi is up more than 2.5% this afternoon, rallying on the heels of ADP's payroll data from February. U.S. companies hired the most in almost three years, according to the numbers, fueling speculation that additional Fed rate hikes will go as planned in 2017, a boon for banking stocks.
Citi looks attractive from a technical standpoint -- and it has for a while now. This stock's uptrend remains very much intact as we head deeper into March, and that means that it continues to make sense to "buy the dips" in Citi in the weeks ahead.
Trina Solar Limited
- Nearest Resistance: $11.55
- Nearest Support: $11.49
- Catalyst: Going-Private Deal
Trina Solar Limited (TSL) is another stock that's seeing huge volume on Wednesday. Shares are up 5.8% after the solar panel manufacturer set a closing date for the deal to take the company private. The $1.1 billion deal will pay investors $11.55 in cash for each American Depositary Receipt held on March 15.
At this point, the money has already been made on the Trina Solar trade; shares trade for less than a 1% discount to the deal price as I write. Traders who missed out on TSL should look elsewhere for gain opportunities in March.
VanEck Vectors Gold Miners ETF
- Nearest Resistance: $23
- Nearest Support: $20
- Catalyst: Spot Gold Prices
The VanEck Vectors Gold Miners ETF (GDX) - Get Reportcontinues to be one of the most popular ways for investors to get exposure to the ebb and flow of gold prices. As a gold miners ETF, GDX is basically a leveraged bet on gold prices without the negative side-effects found in ETFs that invest in derivatives to multiply their gold exposure.
That said, the price action doesn't look particularly attractive in GDX right now. Shares have violated three support levels in the last four weeks, clearing a path to potential support at $20.
Put simply, GDX could have further to fall before it stabilizes. Gold bulls should exercise some patience before buying a position in this stock.
- Nearest Resistance: $25.50
- Nearest Support: N/A
- Catalyst: Q4 Earnings
Mid-cap apparel retailer Urban Outfitters (URBN) - Get Reportis getting hammered almost 6% lower in Wednesday's session, dropping thanks to a miss on fourth-quarter earnings. Urban Outfitters earned adjusted profits of 55 cents per share for the quarter, missing Wall Street's consensus estimates by about a penny. More importantly, management's comments for the year ahead were bleak during the firm's earnings call, with CEO Richard Hayne calling the current retail environment a burst bubble.
Technically speaking, shares of URBN are breaking down. Shares had been holding onto key support at $25.50 for the better part of the last year, but that's all changed with Wednesday's violation of that price level. More downside risk just opened up in URBN.
- Nearest Resistance: $27
- Nearest Support: $23
- Catalyst: Q1 Earnings
Another earnings mover this afternoon is $3.45 billion tech company Ciena (CIEN) - Get Report. Ciena is down 8.7% on Wednesday following its own earnings miss. The firm posted adjusted first-quarter profits of 26 cents per share, missing the 29-cent earnings number that analysts were expecting, on average.
While Ciena is down, it's far from out. Shares are holding onto the well-defined uptrend that's been in place since all the way back in mid-May. From a technical standpoint, it makes sense to wait for a retreat closer to support at $23, then buy the bounce higher.
- Nearest Resistance: $24.50
- Nearest Support: $20
- Catalyst: Q3 Earnings
Rounding out our list of the market's most actively traded stocks is tax prep services provider H&R Block (HRB) - Get Report. H&R Block reported third-quarter earnings results that were better than expected, with the firm's 49-cent loss smaller than the 52.5-cent loss Wall Street was expecting on average. H&R Block's better-than-expected start to tax season bodes well for the fourth quarter, the firm's seasonally strongest quarter by far.
Technically, H&R Block is closing in on a key level this week. Shares are pushing up towards long-term resistance at $24.50, a price level that's been a ceiling for shares stretching back to last summer. If HRB can manage to break through that line in the sand, look for significantly more upside ahead during tax season.
At the time of publication, author had no positions in the stocks mentioned.
Note: This article contains one or more stocks with a market cap between $350 million and $2 billion. Such small-cap stocks tend to be volatile.