These 3 Big Stocks Are Flashing Buy Signals on Big Volume
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.
Applied Materials
- Nearest Resistance: N/A
- Nearest Support: $21.50
- Catalyst: Q2 Earnings
Leading off our list of the last week's most-active stocks was Applied Materials (AMAT) - Get Report . Applied ended the week on a high note, rallying almost 14% Friday after reporting second-quarter earnings the night before. Excluding one-time earnings, Applied Materials earned profits of 34 cents per share for the quarter, coming in slightly ahead of the 32-cent profit that analysts were hoping for. But guidance for the third quarter came in at an even bigger positive surprise, driving the end-of-the-week move in this big tech stock.
From a technical standpoint, Applied looks attractive right now. Shares broke out above $21.50 resistance, a price ceiling that shares tried (and failed) to clear back in April. From here, Applied looks set to test higher ground ahead.
Pfizer
- Nearest Resistance: $36.50
- Nearest Support: $33.50
- Catalyst: Technical Setup
The technical factors were in play in shares of Pfizer (PFE) - Get Report on Friday, pushing shares through an important breakout level to end the week. Pfizer only gained a little over 1% during Friday's session, but the move was technically significant, pushing the stock through an important resistance level at $33.50 and signaling more upside ahead for this pharmaceutical giant.
As long as shares can hold $33.50 heading into Monday's session, consider Pfizer a buying opportunity in May.
Cisco Systems
- Nearest Resistance: $28.50
- Nearest Support: $27
- Catalyst: Post-Earnings Move
Finally, shares of technology giant Cisco Systems (CSCO) - Get Report finished the week on big volume, up 1.5% after gapping higher earlier in the week on strong third-quarter earnings results.
At this point, the technical story is the one to watch in Cisco, particularly as shares move up to test an important long-term resistance level up at $28.50. If shares are able to muster the strength to break out above $28.50, investors have a pretty clear buy signal in this computer networking stock. In the meantime, Cisco's uptrend remains intact.
Cisco is a holding in Jim Cramer's Action Alerts PLUS charitable portfolio. Following Cisco's earnings last week, Cramer and Research Director Jack Mohr wrote:
Cisco had been plagued by negativity heading into its quarter, yet fired on all cylinders while proving to investors that its transition from "old tech" to "new tech" is not only happening as we speak, but occurring at a faster pace than anyone expected. The company's growth was carried by the high-growth, high- margin and highly recurring segments and corresponding revenue streams that every tech company wants exposure to, yet few have attained.
Disclosure: This article is commentary by an independent contributor. At the time of publication, the author held no positions in the stocks mentioned.
