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: $25
Nearest Support: $23
Catalyst: Mine Purchase
Gold prices may be up this afternoon, but $12 billion gold mining company Newmont Mining (NEM) isn't participating in the bump. Instead, this large-cap gold stock is down 1.7% on big volume this afternoon, following news that Newmont will raise $682 million in a share offering to use toward the purchase of a Colorado gold mine from AngloGold Ashanti (AU). The dilution represents about 7% of Newmont's outstanding shares.
More significantly, the announcement is pushing shares down enough to violate the uptrend that's been in play in Newmont since the calendar flipped to 2015. With the bottom of Newmont's uptrend broken, this stock could have more downside ahead. Investors looking for gold exposure should look to other miners this summer.
HCC Insurance Holdings
Nearest Resistance: $78
Nearest Support: $76.99
Specialty insurance company HCC Insurance Holdings (HCC) is up almost 36% on huge volume this afternoon, rallying following news that the firm was being acquired for $78 per share in cash by Japanese insurer Tokio Marine Holdings. The deal puts a lofty premium on HCC's shares, about 1.9 times book value.
That said, late-to-the-game traders may as well move on. With a tiny merger premium left in shares, it looks like the money has already been made on the announcement.
Nearest Resistance: $8.50
Nearest Support: $6.50
Catalyst: CEO Comments
Brazilian mining company Vale (VALE) is up more than 7% this afternoon, boosted by comments from Murilo Ferreira that China is cutting approximately 200 million tons of iron-ore output capacity, despite increasing demands. That shortfall bodes well for iron miners like Vale, which will see increased demand as a result of the change.
After selling off for the last year and change, Vale is beginning to look "bottomy" in the long-term. Shares are forming an inverse head and shoulders pattern with a breakout level up at $8.50 resistance. Put simply, if shares can catch a bid above $8.50 again, this stock could have a meaningful upside run ahead of it.