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 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.
Without further ado, here's a look at today's stocks.
RF Micro Devices
Nearest Resistance: $11.21
Nearest Support: $10
Catalyst: Q1 Earnings
Radio frequency chipmaker RF Micro Devices (RFMD) is up 3.2% this afternoon, following positive first-quarter earnings and guidance for next quarter. Investors had been expecting profits of 17 cents per share, but RFMD actually earned 24 cents for the period, tacking on strong results to what's already been a strong month for this stock.
The $10 level got taken out earlier in June, and earnings are propelling shares of RFMD even higher this afternoon. Support at $10 is a lot stronger than this stock's nearest resistance level at $11.21. If you decide to go long here, the 50-day moving average is a logical place to keep a protective stop.
Maxim Integrated Products
Nearest Resistance: $33.50
Nearest Support: $27
Catalyst: Q4 Earnings
Maxim Integrated Products (MXIM) is selling off more than 12% this afternoon, following the firm's fiscal fourth quarter earnings call after the closing bell yesterday. The firm posted adjusted earnings of 43 cents per share for the quarter, slipping just below Wall Street's 47-cent estimate. Worse, the firm's forecast first-quarter numbers were similarly below analysts' best guess -- and the call was met with analyst downgrades as a result.
From a technical standpoint, MXIM started showing cracks at the start of the week, when the stock broke below the uptrend that had been intact since the start of 2014. While shares are climbing higher over the course of today's session, that's cold comfort for investors -- MXIM is lower today than it's been anytime since January. Stay away until shares can find some semblance of support.
Nearest Resistance: N/A
Nearest Support: $185
Catalyst: Q2 Earnings
Shares of Chinese internet search provider Baidu.com (BIDU) are up almost 10% this afternoon, following better-than-expected quarterly results that hit Wall Street yesterday. Baidu earned 3.55 billion yuan for its second quarter, well ahead of the 2.85 billion-yuan consensus estimate from analysts. Particularly encouraging was the fact that all-important mobile revenues contributed close to a third of overall sales for the quarter. The buying frenzy is pushing BIDU up to new highs this afternoon.
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: $32
Nearest Support: N/A
Catalyst: Q2 Earnings
Mid-cap software stock Informatica (INFA) is down more than 12% on huge volume this afternoon, dragged lower following the firm's second-quarter earnings call. Analysts as Susquehanna and Robert Baird cut INFA following the earnings call, on which Informatica reported that earned profits of 20 cents per share but guided lower for the third quarter. That lower guidance is the catalyst for the selloff this afternoon.
Not that you'd have wanted to own this chart from a technical standpoint anyway. INFA has been in a well-defined downtrending channel since the start of 2014, bouncing lower on every test of trend line support year-to-date. Today's big gap down is accelerating the downtrend in INFA, so it makes a lot of sense to keep away from this name right now.
To see these stocks in action, check out the at Most-Active Stocks portfolio on Stockpickr.
-- Written by Jonas Elmerraji in Baltimore.