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 their analysis.
So, today, we'll leverage the power of the crowd to take a look at some of the most active stocks on the market.
Bank of America
- Nearest Resistance: $24
- Nearest Support: $22
- Catalyst: Living Will Approval
Leading off our list of Monday's most actively traded stocks is financial services giant Bank of America (BAC) . BofA is correcting slightly this afternoon, down just shy of 1% on news that the bank's "living will" has been approved by regulators, provided the bank unwinds its derivatives trading in 2017. Bank of America's next living will submission is due on July 1.
From a technical standpoint, Bank of America continues to look strong right now, consolidating sideways in recent weeks after an explosive move higher.
That sideways price action is giving shares the opportunity to bleed off some overbought momentum, setting the stage for another possible leg higher this winter.
- Nearest Resistance: $1.60
- Nearest Support: $1.30
- Catalyst: Wi-Fi Proposal
Globalstar (GSAT) is up more than 31% on massive volume this afternoon, ranking as one of the highest-volume issues on the NYSE following news that the firm's revised terrestrial low-power service proposal is being put in circulation by the FCC, bringing it one step closer to approval. Cowen analyst Lance Vitanza said that Globalstar could triple if the proposal is approved by the FCC, leaving plenty of gain potential left in shares following the last couple of trading sessions' rallies.
Globalstar had been pointing lower in a falling wedge for most of 2016, but Friday's breakout through $1 is reversing that trend. From here, shares need to clear prior resistance at $1.60 before they can make an attempt to Globalstar's prior highs at $3.
For traders willing to stomach the headline risk in this stock right now, Globalstar looks attractive from a technical standpoint.
Hilton Worldwide Holdings
- Nearest Resistance: N/A
- Nearest Support: $26
- Catalyst: Technical Setup
Large-cap hotelier Hilton Worldwide Holdings (HLT) is up slightly on big volume, making new highs this afternoon for technical reasons.
Hilton has been in "breakout mode" since clearing prior resistance at $24 back in mid-November. Since then, shares have consistently made new highs.
If you decide to buy into Hilton's momentum here, it makes sense to park a stop on the other side of shares' most recent swing low at $26.
- Nearest Resistance: $21
- Nearest Support: $19
- Catalyst: Pre-Earnings Positioning
Micron Technology (MU) is flat on huge volume this afternoon, as investors position themselves for this stock's first-quarter earnings call on Dec. 21. Right now, Wall Street is expecting Micron to post a fiscal first-quarter profit of 26.2 cents per share on average, with guidance expected to come in at 28 cents per share. Micron has been prone to dropping on the heels of earnings calls, ending up lower in seven of the last eight post-earnings trading sessions.
That said, Micron's price trend might be enough to offset any negative reaction to earnings. Micron has been in a very well-defined uptrend since mid-May, bouncing its way higher in a price channel that's still intact.
Resistance at $21 is the next meaningful upside barrier in Micron. If it gets taken out on earnings, we've got a fresh buy signal in this tech stock.
- Nearest Resistance: $13.25
- Nearest Support: $12.60
- Catalyst: Technical Setup
Automaker Ford Motor (F) is another big stock that's seeing a big-volume session despite being more or less flat to start the week. Ford's volume-driver is technical here, as shares test the bottom of the uptrending channel that's been in play from its November lows through Monday.
The next buying opportunity comes on the next bounce off of this trendline support level -- if and when that happens, we're likely to see Ford test key resistance at $13.25 this December.
- Nearest Resistance: $3
- Nearest Support: $2.60
- Catalyst: Technical Setup
Social video game maker Zynga (ZNGA) is down 3% on big volume this afternoon, as shares test an important technical price floor at $2.60 Monday. Zynga's price action has been trading sideways in a well-defined channel since July, and that's not changing here as this stock gets batted lower on a test of $3 resistance.
If you're looking for a buying opportunity in Zynga, it's wise to wait for buyers to muster the strength to push shares through $3 before you join them.
Allied World Assurance Holdings
- Nearest Resistance: $54
- Nearest Support: $52
- Catalyst: Acquisition
Last on our list of actively traded stocks is mid-cap insurance company Allied World Assurance Holdings (AWH) . Allied is up almost 12% on Monday following news that it's being acquired in a cash and stock deal worth $4.7 billion. Canadian financial firm Fairfax Financial Holdings is the buyer.
Shareholders will receive approximately $54 per share in combined value when the deal closes, based on current market prices. That price leaves a small 5.4% premium in AWH right now, implying that the market sees just over a 62% probability that the deal gets completed as planned.