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.
Nearest Resistance: $30
Nearest Support: $26.50
Catalyst: Loan Sale
General Electric's (GE) financial asset garage sale keeps propelling this stock higher in 2015. Shares of the diversified industrial conglomerate are seeing big volume following the announcement that GE is selling off a Japanese loan portfolio worth 65 billion yen to Shinsei bank.
GE's long-term plan to unload its financial services assets has provided a big tailwind for the rest of the company, and it's helped shares move higher in an uptrend for 2015. GE's in the middle of its price channel now, so it makes sense to wait for the next test of support before you buy.
ITT Educational Services
Nearest Resistance: $4.25
Nearest Support: $4
Catalyst: 10-K Filing
Sometimes, it's the little things that get investors excited. Take small-cap for-profit education stock ITT Educational Services (ESI), for example. This tiny stock is one of the biggest-volume trades on the NYSE this afternoon because the firm filed its 10-K; shares are up more than 70% on the day as I write. ITT had received a listing notice from the NYSE because of its failure to file the required annual report. Filing today should buy investors some more time.
But that doesn't mean you should buy it. ESI's chart looks less ugly after today's big move higher, but it still looks pretty ugly. We're a long way away from the top of the downtrend that's swatted shares lower on every test since last fall. The primary trend is still down in ESI.
Nearest Resistance: N/A
Nearest Support: $40
Catalyst: Pershing Stake Rumors
Snack food maker Mondelez International (MDLZ) is enjoying a second straight day of big-volume upside after rumors hit that Bill Ackman's Pershing Square hedge fund was set to announce a large activist stake in the firm. The speculation is proving enough to push MDLZ to new highs this afternoon.
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 MDLZ now.