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.
Nearest Resistance: N/A¿
Nearest Support: $21¿
Catalyst: MoneyGram Acquisition Rumors
Rumors that Western Union (WU) is in talks to buy smaller rival MoneyGram (MGI) are spurring a big-volume pop in shares this afternoon, driving this money movement and payment services stock more than 7% higher in today's session. While the deal is still in nascent stages, investor speculation that the combined firm will be able to earn bigger profits from their combined scale is what's shoving WU to new highs today.
Making new highs is significant from an investor psychology standpoint because it means 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. For traders who want to ride the bullish momentum, there's still time to build a position in WU now.
Nearest Resistance: $6.80¿
Nearest Support: $6.20¿
Catalyst: Q1 Earnings
Brazilian beverage stock Ambev (ABEV) is seeing a modest big-volume move higher this afternoon, spurred on by the firm's first-quarter earnings numbers. Ambev earned $2.97 billion reais for the quarter, outpacing analysts' expectations for the start of the year. Overall, sales rose 15% to 10.8 billion reais.
From a technical standpoint, Ambev has looked ugly lately. Shares have been forming a pretty textbook downtrend, bouncing their way lower all the way back to last summer. But today's earnings move is putting some distance between shares and that prior downtrend. Now looks like a pretty good time to be a buyer in ABEV.
Nearest Resistance: $6.85¿
Nearest Support: $5.75¿
Catalyst: Q1 Earnings
Groupon (GRPN) is having a tough session today. While it may not be the biggest mover on an absolute basis, shares are violating a key support level this afternoon following first-quarter earnings numbers. GRPN earned profits of 3 cents per share for the first quarter, a number that just barely edged out analysts' best guess. But shares are down almost 6% as I write thanks to a miss on forward guidance. The high-end of the firm's expected revenues still came in short of what Wall Street wanted to see next quarter.
The violation of support at $6.85 means that GRPN is opening itself up to a lot more downside risk at this point. If you're waiting for an opportunity to be a buyer in GRPN, you'd better keep on waiting.