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 Walnvestors, 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: $20.50
Nearest Support: $19
Catalyst: Q2 Earnings
Semiconductor equipment maker Applied Materials (AMAT) is seeing a 3% pop on big volume this afternoon, a move sparked by second-quarter earnings numbers. AMAT beat analyst estimates by a penny, taking in 29 cents of earnings per share for the quarter. Likewise, the firm's expectations for the third quarter fell in line with what Wall Street was expecting.
The good news is that today's earnings reaction is helping to spur shares higher after what's been a pretty ugly start to 2015 – and they're testing resistance at $20.50 this afternoon. The bad news is that the downtrend in AMAT is still very much in effect right now. I'd avoid being a buyer until this stock can start making higher lows.
Hertz Global Holdings
Nearest Resistance: $22
Nearest Support: $19.50
Catalyst: Q1 Earnings
Hertz Global Holdings (HTZ) is another earnings-fueled mover this afternoon. Shares of the $10 billion rental car company are up more than 5% this afternoon, following Hertz's preliminary first quarter earnings results. Hertz saw revenues of $2.44 billion for the quarter, coming in just shy of Wall Street's $2.51 billion estimate. But shares are getting some buying pressure after the firm announced a plan to close about 200 locations by the end of Q2 in a cost cutting measure, while raising prices to take advantage of an expected increase in summer demand.
Technically speaking, HTZ still has a pretty ugly chart. Shares are forming a long-term descending triangle pattern with support at $19.50. In short, if that $19.50 level gets violated, then HTZ could be in store for material downside risk.
Nearest Resistance: $9
Nearest Support: $8
Catalyst: Analyst Upgrade
Department store retailer J.C. Penney (JCP) is up almost 5% this afternoon, up after an analyst upgrade this morning helped to counter shares' post-earnings stumble from earlier this week. Analysts at BMO raised their rating on Penney from "underperform" to "market perform", spurring some more buying after yesterday's downside action.
Overall, JCP's chart actually looks pretty attractive right now. Shares have been in an uptrend going back to the middle of December, giving investors a buying opportunity on every touch of trendline support. Now, as shares bounce for a sixth time over the course of the trend, this looks like a pretty attractive time to step into the JCP trade.