Reasons to Sell Google, Wells Fargo, Tibco, LKQ, SL Green Realty Now

NEW YORK (TheStreet) -- The decline in the Standard & Poor's 500 earlier this month was a wakeup call for investors. The return of nearly half the lost value in just a span of two weeks is something to be watched carefully.

That's why it is time to look at some of the stocks that aren't as good to hold as they were before August, including some familiar names. They are nowhere near failure but if you want to invest in them it may be better to wait.

A technical study involved investor psychology, the trends in stocks and the price action. This analysis helps to decide on the stocks that are favorable for investors. Technical analysis aids in good trades and also to plan the stock execution in a better way.

Here are the stocks to avoid:

Wells Fargo

Wells Fargo (WFC)   has had a definite bullish trend, but in August took a drop. Shares, at $51, are up 12% for the year to date. The technical analysis shows two high swings that have the same top level and separated by a high known as head. The close down below the top indicates a sell signal. This change in trend started when WFC underperformed during July.

Courtesy of StockCharts.com

Google

The condition at Google (GOOG) is identical to WFC with the same shoulder and head signal, but the change here is that the sell signal has not been triggered. At $597, shares are up nearly 7% year to date. The sell signal will occur when the bounce below $570 happens in the class A shares. The momentum gauge that indicates price aptly shows here that investors need to sell when the $570 mark is violated.

Courtesy of StockCharts.com

LKQ

This has not been a good year for LKQ (LKQ) . The auto parts manufacturer started the year with shares down 21%. This is not the worst thing.

Courtesy of StockCharts.com

LKQ has both a bearish take on horizontal support at $25 and a resistance to downtrend. At around $27, shares are down 18% for the year to date. When they go below the $25 mark, it is time to sell.

SL Green Realty

Real estate giant SL Green Realty (SLG) has seen a remarkable uptrend with over 15% this year, but from August there is a definite slump in the share value. The stocks showed a double top pattern during the beginning of August and the breakdown occurred at $108. At $111, shares are up nearly 1% year to date.

Courtesy of StockCharts.com

The double top has two swing highs in the top where the price levels are same. When the support level that separates the tops ($108) is broken, the sell signal is the best option. While the level was lucrative for buyers to buy the shares, the breakdown below the level shows that sellers are powerful to absorb the excess demand present at that price range.

Tibco Software

Infrastructure software and mid capital middleware provider Tibco Software (TIBX) has been steadily on the downtrend since September 2013 and the shares are getting off from resistance for the seventh time, which shows that it is better to sell. At $21 the shares are down 6% year to date.

Courtesy of StockCharts.com

But the sale should not occur in August as the parallel trend lines, which indicate the probability range of trading, are pointing down and rightwards. If the next trend bounces low, selling is certainly a good option.

At the time of publication, the author held no positions in any of the stocks mentioned.

¿This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.

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