3 Big-Volume Stocks to Add to Your Buy List This Week
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.
Bank of America
- Nearest Resistance: $15
- Nearest Support: $14
- Catalyst: Technical Setup
Leading things off on our list of high-volume stocks from last week is banking giant Bank of America (BAC) - Get Report . BofA has been a stock in rebound mode -- until the calendar flipped to May, that is. Since then, Bank of America, has been throwing back to retest newfound support at $14.
Overall, BofA is holding out above $14 right now, and that means that the breakout this stock kicked off in mid-April is still holding. From here, a bounce off of that $14 support level would signal a low-risk buying opportunity for Bank of America in May.
Yamana Gold
- Nearest Resistance: $6
- Nearest Support: $4
- Catalyst: Spot Gold Rally
The trend is your friend in gold -- at least that's the story that Yamana Gold (AUY) - Get Report has been telling lately. After spending a couple of sessions correcting, Yamana ended the week back in rally mode, adding another 15% to its share price between Thursday's open and Friday's close.
The uptrend in this gold stock (and its peers) remains very much intact right now, and that's clearing the way for a retest of 52-week highs in May. As Yamana bounces off of trend line support this week, this actually looks like a relatively low-risk place to build a position in Yamana Gold for late-to-the-game traders.
Yelp
- Nearest Resistance: $29
- Nearest Support: $22.50
- Catalyst: Q1 Earnings
Yelp (YELP) - Get Report ended last week rallying hard on first-quarter earnings, up nearly 24% by the time Friday's closing bell rang. Yelp lost 20 cents a share for the first quarter, but earnings were actually much better than expected adjusting for one-time charges. While analysts were expecting those comparable earnings numbers to come in at a 2-cent per share profit, Yelp actually earned an 8-cent profit on a comparable basis. Likewise, guidance numbers came in on the high side of the range that analysts were expecting, the main factor driving Friday's buying frenzy in this tech stock.
Yelp's chart actually looks pretty solid as well right now. After selling off for much of 2016, Yelp appears to have carved out a bottom, triggering an upside move with Friday's gap above resistance at $22.50. From here, prior highs at $29 look like the next challenge for this stock to take on.
Disclosure: This article is commentary by an independent contributor. At the time of publication, portfolios managed by the author were long AUY.
