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.
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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 today.
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Without further ado, here's a look at today's stocks.
Nearest Resistance: N/A
Nearest Support: $72.50
Catalyst: Q2 Earnings
First up is social networking stock Facebook (FB), a name that's seeing bigger-than-normal volume following its second-quarter earnings call. Excluding one-time items, Facebook earned profits of 42 cents per share, beating the average 32-cent analyst estimate. Shares are pushing more than 7% higher as I write this afternoon, pushing shares of FB to new highs.
New highs are significant from an investor psychology standpoint because they mean that everyone who has bought shares in the last year is sitting on gains. As a result, the "back to even" mentality is less of a concern than it would be for a name with a higher proportion of shareholders sitting on losses. If you decide to buy here, keep a tight stop in place.
Nearest Resistance: $78.50
Nearest Support: $72
Catalyst: Q3 Earnings
An earnings beat isn't sparing shares of Qualcomm (QCOM) from selling off this afternoon. The $129 billion mobile chipmaker is off more than 6% following its third quarter earnings release. Qualcomm earned $1.44 per share in profits last quarter, beating the $1.21 that analysts were expecting -- but tepid forecasts and news that the firm is having difficulty collecting licensing revenues in China are the catalysts for the selloff. With China tipping the scales as the world's largest handset market, manufacturers' ambivalence towards paying royalties to QCOM is a real potential problem.
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For shareholders, there's another problem: The technical breakdown below former support at $78.50. Shares of QCOM had been looking very constructive, clearing resistance at $81 for two sessions ahead of earnings. But today's results made that move a bull trap now that shares have violated the $78.50 level. From here, look out below.
Nearest Resistance: $36
Nearest Support: $31
Catalyst: Flurry Acquisition
Yahoo! (YHOO) is seeing higher-than-usual trading volume, following yesterday's news that the firm had acquired mobile app analytics firm Flurry for $300 million. The acquisition gives Yahoo! audience and app usage analytics that it's likely to integrate with its ad platform to give web marketers a more robust picture of who they're selling to. That added level of granularity could help Yahoo! capture higher revenues per click for its efforts.
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But I wouldn't buy this stock right now. Yahoo!'s chart looks toxic right now thanks to a downtrend that's been swatting shares lower on every attempt to break higher going all the way back to January. With shares testing resistance for a sixth time now, it makes sense to sell the first sign of another bounce lower.
Nearest Resistance: N/A
Nearest Support: $7.80
Catalyst: Q2 Earnings
Finnish telephony stock Nokia (NOK) is up 8% on big volume this afternoon, the result of better-than-expected second quarter earnings numbers. NOK earned 6 euro cents per share, coming in ahead of the 4.5-cent best guess from Wall Street. Following Nokia's sale of its handset unit to Microsoft (MSFT), the firm has seen much stronger sentiment from the investment community -- and that's showing through with the new highs shares are hitting after breaking out above $7.80 resistance this morning.
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For investors who aren't risk-averse, NOK's gap up this morning provides a good opportunity to jump on another wave of momentum.
To see these stocks in action, check out the at Most-Active Stocks portfolio on Stockpickr.
-- Written by Jonas Elmerraji in Baltimore.