NEW YORK (TheStreet) -- It's getting crowded behind the first-quarter earnings woodshed as the seven stocks profiled today are down between 28% and 57% from their 2014 intraday highs. Trying to buy stocks after they've declined so far so fast is like trying to catch a falling knife.
This is difficult when all seven are below their five-week modified moving averages and their 21-day, 50-day and 200-day simple moving averages. Three are above their 200-week SMAs, but three are recent IPOs and thus do not have enough price history to have 200-week SMAs.
You never know when these stocks will become momentum stocks again, but we have "crunched the numbers" to help you decide whether or not to buy weakness to value levels or to sell strength to risky levels. Another problem is that four of seven do not have value levels.
Amazon (AMZN) ($292.71) is down 28% from its 2014 intraday high at $408.06. The stock traded as low as $286.68 on Wednesday with this week's value level at $283.97. The weekly chart is negative but oversold with its five-week MMA at $321.50. Our annual value level is $259.67 with annual and semiannual risky levels at $334.95 and $351.24, respectively.
American Online (AOL) ($34.85) is down 35% form its 2014 intraday high at $53.28. AOL missed analysts' earnings per share estimates by 8 cents before the opening bell on Wednesday and broke below its 200-day SMA at $40.99 at the open and traded as low as $32.31. The weekly chart is neutral with its five-week MMA at $41.56 and its 200-week SMA at $28.58, which is a good level at which to catch this falling knife.
3D Systems (DDD) ($49.11) is down 50% from its 2014 intraday high at $97.28. The weekly chart is negative but oversold with its five-week MMA at $54.14 and this parabolic bubble has clearly popped. Weekly and annual value levels at $38.06 and $33.80, respectively, are levels at which to catch this falling knife. We have an annual pivot at $52.19 with semiannual risky levels at $57.37 and $77.78.
Groupon (GRPN) ($5.33) is down 57% from its 2014 intraday high at $12.42. The stock got crushed to as low as $5.18 on Wednesday on weaker-than-expected earnings. The weekly chart is negative but oversold with its five-week MMA at $7.29. We do not show a value level but have a weekly pivot at $6.53 and a monthly risky level at $8.01.
Pandora (P) ($21.17) is down 48% from its 2014 intraday high at $40.44 then traded as low as $21.47 on April 28. The weekly chart is negative but oversold with its five-week MMA at $26.91. A weekly value level at $18.82 is the price at which to consider catching this falling knife. Quarterly and monthly risky levels are $28.89 and $38.45, respectively.
Twitter (TWTR) ($30.66) is down 57% from its 2014 intraday high at $70.43 then traded as low as $29.51 on Wednesday. This is a recent IPO, so we do not have a 200-day or 200-week SMA. The weekly chart is negative but oversold with its five-week MMA at $42.34. A quarterly pivot is $34.36 with a monthly risky level at $76.09.
Whole Foods Market (WFM) ($38.93) down 33% from its 2014 intraday high at 49.18. Whole Foods missed analysts' EPS estimates by 3 cents before the opening bell on Wednesday, and the stock plunged to as low as $37.31. The weekly chart is negative with the five-week MMA at $48.56 with the 200-week SMA at $40.71. We show a weekly pivot at $48.29 with monthly and quarterly risky levels at $56.69 and $58.99, respectively.
Crunching the Numbers With Richard Suttmeier: Moving Averages & Stochastics
This table provides the technical status for the stocks profiled in today's report.
There are five columns with moving average titles: Five-Week Modified Moving Average; 21-Day Simple Moving Average; 50-Day Simple Moving Average; 200-Day Simple Moving Average; and the 200-Week Simple Moving Average.
The column labeled 12x3x3 Weekly Slow Stochastics shows the pattern on each weekly chart with a reading of oversold, rising, overbought, declining or flat.
Interpretations: Stocks below a moving average are listed in red.
Five-Week Modified Moving Average (MMA) is one of two indicators that define whether a weekly chart profile is positive, neutral or negative. The other is the status of the 12x3x3 weekly slow stochastic.
A stock with a positive technical rating is above its five-week MMA with rising or overbought stochastics.
A stock with a negative technical rating is below its five-week MMA with declining or oversold stochastics.
A stock with a neutral technical rating has a profile that is not positive or negative.
The 200-Week Simple Moving Average (SMA) is considered a long-term technical support or resistance level and as a "reversion to the mean" over a rolling three- to five-year horizon. (Even Apple (AAPL) declined to its 200-week SMA in June 2013.)
The 21-Day Simple Moving Average is a short-term technical support or resistance used by many hedge fund traders to adjust positions. A stock above its 21-day SMA will likely move higher over a rolling three- to five-day horizon and vice versa.
The 50-Day Simple Moving Average is also a technical support or resistance used by many strategists and commentators in financial TV.
The 200-Day Simple Moving Average is another technical support or resistance level, and I consider this level as a shorter-term "reversion to the mean" over a rolling six- to 12-month horizon. (Even Apple tested or crossed its 200-day SMA in nine of the last 10 years.)
Crunching the Numbers With Richard Suttmeier: Earnings & Where to Buy & Where to Sell
This table presents the EPS estimates including date and before or after the close, and where to buy on weakness and where to sell on strength.
"EPS Date" is the day the company reports its quarterly results.
"EPS Estimate" is the EPS estimate from Wall Street analysts.
Value Levels, Pivots and Risky Levels are calculated based upon the last nine weekly closes (W), nine monthly closes (M), nine quarterly closes (Q), nine semiannual closes (S) and nine annual closes (A). I have one column for pivots, which is a magnet for the period shown. The columns to the left of the pivots are first and second value levels. The columns to the right of the pivots are first and second risky levels.
Investors who wish to buy a stock should use a good-'til-canceled limit order to buy weakness to a value level. Investors who want to sell a stock should use a GTC limit order to sell strength to a risky level.
At the time of publication the author held no positions in any of the stocks mentioned.
This article represents the opinion of a contributor and not necessarily that of TheStreet or its editorial staff