BALTIMORE (Stockpickr) -- Put down the 10-K filings and the stock screeners. Its 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. Its a concept thats 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, well leverage the power of the crowd to take a look at some of the most active stocks on the market today.
These most active names are the most heavily-traded names on the market -- and often, uber-active names have some sort of a technical or fundamental catalyst driving investors attention on shares. Thats especially true now that earnings season is officially underway. And when theres a big catalyst, theres often a trading opportunity.
Without further ado, heres a look at today's stocks.
To see these stocks in action, check out the at Most-Active Stocks portfolio on Stockpickr.
Nearest Resistance: $56
Nearest Support: $52
Catalyst: Earnings/PayPal Spinoff Speculation
Online auction giant eBay (EBAY) is trading flat on huge volume today, the aftermath of quarterly earnings and calls from activist investor Carl Icahn to spin off the firm's PayPal unit. On a non-GAAP basis, eBay earned 81 cents per share for the fourth quarter, topping analyst estimates by a cent. But the possibility of unlocking shareholder value by spinning off PayPal is the real reason eBay is getting attention.
Technically, eBay's chart looks pretty rough. This stock has been in a long-term downtrend, and shares are coming up to test resistance at $56. We're at a spot where it's historically been ideal to sell shares of eBay, not buy them. Until this stock can break free from its serial underperformance of the S&P 500, I'd recommend staying away.
Nearest Resistance: $8
Nearest Support: $6
Catalyst: Acquisition Rumors
The rumor mill is spinning in shares of drug maker Ariad Pharmaceuticals (ARIA). Speculation over a potential takeover of the $1.3 billion firm is prompting buying, with shares up around 11% in this afternoon's session. That makes the last few months particularly good for ARIA shareholders; the small-cap firm rallied hard into 2014 on news that the FDA was partially lifting the suspension of its leukemia treatment. That's a welcome reprieve after a big drop in October.
You can't find a much better-looking chart than ARIA's right now. Shares broke out from an inverse head and shoulders pattern at the end of December, and they've been consolidating just below $8 resistance for the last few weeks. A breakout above $8 is a buy signal.
With ARIA still well below its pre-October levels, there's ample room for this name to run if it can catch a bid above $8.
Nearest Resistance: $60
Nearest Support: $55
Catalyst: Princeton User Study
Maybe it's because Mark Zuckerberg started his company in a Harvard dorm room, but ivy-league rival Princeton is causing problems for him this week. Social network Facebook (FB) is off more than 2% for the second day in a row, after a Princeton University study indicated that the firm's eponymous Web site could lose 80% of its user-base in the next three years. The study, which used MySpace as an example case, indicates that FB is beginning to show early signs of mass user abandonment. Despite the black clouds, the relatively small drop in shares indicates that investors aren't convinced.
Likewise, Facebook looks stellar from a technical standpoint right now. Shares have been outperforming the S&P since last summer, and in the short-term, we're seeing an ascending triangle setup forming in shares. FB's buy signal comes on a push through resistance at $60.
-- Written by Jonas Elmerraji in Baltimore.