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: $40.50
- Nearest Support: $39
- Catalyst: Q3 Earnings
Enterprise tech giant Oracle (ORCL - Get Report) is up more than 4% this afternoon, boosted following the firm's third-quarter earnings update. Oracle earned third-quarter profits of 64 cents per share, coming in slightly ahead of Wall Street's 62-cent best guess. The board also authorized an additional $10 billion share buyback, signaling a big push to return value to shareholders in 2016.
Technically speaking, Oracle looks excellent right now. Shares are testing their prior swing high at $40.50, a price level that, if taken out, means that we're very likely to see a test of this stock's 52-week highs. If you're looking for a buying opportunity in Oracle, it makes sense to wait for shares to break above $40.50 before jumping in here.
For another take on Oracle's chart, check out "Here's How to Trade Oracle After Its Post-Earnings Surge."
U.S. Oil Fund
- Nearest Resistance: $10.50
- Nearest Support: $9.50
- Catalyst: Oil Rally
Oil prices are jumping this afternoon, boosted by EIA petroleum inventories that grew less than analysts were expecting. That pop in oil is translating into a 3.3% jump in shares of the U.S. Oil Fund (USO - Get Report) , investors' best investible proxy for crude oil prices.
USO has been looking "bottomy" for most of 2016, most recently with shares consolidating just shy of the top of their resistance range at $10.50. A confirmed breakout above $10.50 would send a pretty clear signal that buyers are back in control of oil prices this spring.
For another take on USO, check out "Using ETFs to Buy Oil? Here's Why You May Not Get the Returns You Expect."
- Nearest Resistance: $35
- Nearest Support: $31
- Catalyst: Technical Setup
Shares broke out of a classic inverse head and shoulders pattern late last week, moving above the $31 price level that's been acting as resistance for all of 2016. Now shares are consolidating just above that $31 level.
More upside looks likely at this point; the next meaningful resistance level doesn't come into play in Intel until $35. That makes this giant chipmaker a textbook "breakout" buy at current levels.
- Nearest Resistance: $2.50
- Nearest Support: $1.75
- Catalyst: Earnings Delay
SunEdison (SUNE) is down 5% this afternoon, shedding value after the firm announced that a material weakness in its accounting controls meant that its overdue annual earnings filing would be delayed further.
Despite the bad news on the earnings front, SunEdison's price action actually looks pretty attractive in the long term. After spending the last year in selloff-mode, this stock is showing signs of a bottom. $2.50 resistance is the big level to watch from here. If shares can catch a bid above that line in the sand, then shares are likely to see a meaningful move higher in 2016.