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: $30.50
- Nearest Support: $28
- Catalyst: Technical Setup
Even though shares have rallied almost 4% in the last two days, year-to-date, Pfizer is still down 8.2%. And long term, this technical move still looks bearish thanks to a pretty well-defined downtrending channel in shares.
For now, it makes sense to avoid this stock's long side.
- Nearest Resistance: $25
- Nearest Support: N/A
- Catalyst: Q4 Earnings
Fourth-quarter earnings are the catalyst behind today's big volume drop in shares of SolarCity (SCTY) . This $2 billion solar stock is down 20% as I write this afternoon, following a slightly better-than-expected quarter. While Wall Street was expecting Solar City to lose $2.58, on average, the company lost only $2.37 once one-time items were accounted for. Even so, weak guidance for the first quarter and concerns over 2016 execution has spurred the big selloff in SolarCity today.
Technically speaking, SolarCity violated a key support level at $25 at the open today. That move clears that way for more downside in February. In other words, longs should look out below in this big solar stock.
- Nearest Resistance: $0.80
- Nearest Support: N/A
- Catalyst: FDA Clinical Hold
Tiny biopharmaceutical stock CTI BioPharma (CTIC - Get Report) is tipping the scales as one of the Nasdaq's highest-volume issues this afternoon, following negative news coming from an FDA decision over a clinical trial. CTI BioPharma is down 42% on huge volume this afternoon, reacting to the FDA's decision to put a full clinical hold on its pacritinib trial, citing concerns that the Persist-2 test is showing detrimental effects in patients.
CTI BioPharma's chart looks broken at this point. Shares violated their downtrend on Monday, and they're seeking out lower levels still. Shares are following the FDA news cycle at this point. Buyers should avoid it.