Researchers and fund managers are just a few of the individuals who will use filters to find investable securities.
I took a list of 14 cheap stocks from Goldman Sachs and added my own filter of my favorite technical tools, which cut down to just four stocks.
Read on to see what the charts say.
1. Verifone Systems
In this daily chart of Verifone Systems (PAY) , we can see that the downtrend from June has been broken.
Prices are above the now rising 50-day simple moving average line. Prices are currently testing the 200-day average. The on-balance-volume, or OBV, line has been moving up strongly since February, indicating aggressive buying.
At the moment, there is no bearish divergence with momentum to be an "amber light" on further gains.
A close above $29 for Verifone stock should prompt further near-term gains.
Dublin, Ireland-based Icon (ICLR) has been in a sideways trend for the past 12 months.
The OBV line turned up in October and has been steady since. Prices are above the rising 50-day and 200-day moving averages.
Icon could rally into the $80-to-$85 area in the weeks ahead.
Mylan (MYL) has been trading sideways since October.
Mylan stock has been "basing," and dips into the $45-to-$40 area appear to have been bought.
Prices are still below the declining 50-day and 200-day moving averages but could close above them with a small uptick.
4. Wyndham Worldwide
Wyndham Worldwide (WYN) has been bottoming since October.
The OBV line turned up in January. Prices are above the rising 50-day moving average line and below but testing the 200-day line.
A close of $80 will help the bull case.