BALTIMORE (Stockpickr) -- 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 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, we'll 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. That's especially true now that earnings season is officially underway. And when there's a big catalyst, there's often a trading opportunity.
Without further ado, heres a look at today's stocks.
Nearest Resistance: $6.87
Nearest Support: $6.30
Catalyst: Analyst Upgrade
Shares of drugstore chain Rite Aid (RAD) are up more than 5.4% this afternoon, following an upgrade from analysts Goldman Sachs. Goldman upped its price target from $5 to $8, a move that gets extra emphasis because it tops the previous high target on Wall Street for shares of Rite Aid. From a technical standpoint, RAD looks ready to break out again on the heels of the upgrade.
Rite Aid has been a particularly technically obedient name in 2014, and shares' recent consolidation channel is the next big way to take advantage of that fact. Resistance at the $6.87 level is the next upside barrier that needs to get taken out before we've got a buy signal in RAD again.
Nearest Resistance: $5.75
Nearest Support: $5.50
Catalyst: Technical Setup
We're seeing a very similar setup in shares of online game maker Zynga (ZNGA). Shares have been pushing higher this year, up more than 50% year to date on the heels of positive fundamental moves in shares. Now this stock is bumping its head against resistance at the $5.75 level after spending the last several sessions consolidating.
If shares can hold a breakout above that $5.75 price tag in this afternoon's session, we've got a buy signal. Momentum and relative strength look stellar in ZNGA right now, so while this stock may still have some fundamental concerns ahead of it, upside is the high probability outcome from here.
Nearest Resistance: $9
Nearest Support: $8
Catalyst: Analyst Upgrade
An upgrade from Citigroup (C) yesterday is the catalyst for J.C. Penney's (JCP) high-volume move up today. Citi upped JCP's price target from $7.50 to $11, citing the likelihood that the firm will grow out of its liquidity problems later this year. Despite the thumbs up from Wall Street, JCP's upside potential is being constrained by a strong support level at $9 right now.
$9 is an important upside barrier in JCP. It's acted like a ceiling for shares in December, and now, it's continuing to hold shares down. With another previous resistance level at $10, JCP has a lot of overhead supply of shares. That'll make a big move up challenging in the near-term. And, more importantly, there are lots of "easier" trade to take in this market in the meantime.
To see these stocks in action, check out the at Most-Active Stocks portfolio on Stockpickr.
-- Written by Jonas Elmerraji in Baltimore.