Today's Roof Leaker Stock Is AOL (AOL)

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

Trade-Ideas LLC identified AOL ( AOL) as a "roof leaker" (crossing below the 200-day simple moving average on higher than normal relative volume) candidate. In addition to specific proprietary factors, Trade-Ideas identified AOL as such a stock due to the following factors:

  • AOL has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $50.6 million.
  • AOL has traded 806,065 shares today.
  • AOL is trading at 1.72 times the normal volume for the stock at this time of day.
  • AOL crossed below its 200-day simple moving average.

'Roof Leaker' stocks are worth watching because trading stocks that begin to experience a breakdown can lead to potentially massive losses. Once psychological and technical resistance barriers like the 200-day moving average are breached on higher than normal relative volume, the stock may then be subject to emotional selling from investors that can continue to drive the stock lower. Regardless of the impetus behind the price and volume action, when a stock moves with weakness and volume it can indicate the start of a new, potentially dangerous, trend.

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More details on AOL:

AOL Inc. provides various digital brands, products and services to consumers, advertisers, publishers and subscribers worldwide. AOL has a PE ratio of 46.5. Currently there are 7 analysts that rate AOL a buy, 1 analyst rates it a sell, and 5 rate it a hold.

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