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 and market data 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.
So, 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: $56
- Nearest Support: $53.50
- Catalyst: Q4 Earnings
Up first on our list of the week's most actively-traded stocks is big bank Wells Fargo (WFC - Get Report) . Wells Fargo, a holding in Jim Cramer's Action Alerts PLUS portfolio, reported its fourth-quarter earnings numbers Friday, with profits coming in at $1.03 a share, excluding one-time charges. Analysts had been looking for a 99.9-cent profit for the quarter, on average. Wells Fargo moved 1.49% higher on big volume Friday in reaction to the data dump.
Wells has been looking corrective since early December, but the good news is that the correction is happening in the context of an uptrend. WFC bulls should wait for Wells Fargo to push its way back through the top of the corrective downtrending channel that's been in force since those December highs.
- Nearest Resistance: $13.75
- Nearest Support: $11.75
- Catalyst: Guidance Update
Shares of $3 billion online music platform Pandora Media (P) got a shot in the arm Friday, rallying 6.3% in the final session of this past week after management updated investors with better-than-expected guidance late Thursday. Pandora now expects fourth-quarter revenue to be between $362 and $374 million, with analysts' estimates at $368.8 million. Pandora also announced plans to cut its workforce by 7% by the end of the first quarter.
Pandora's technical trajectory isn't crystal clear, but it could be worse. Shares have been making higher lows since bottoming in November, and while most of the upside in shares happened more than a month ago, the fact that shares are catching a bid at support is positive.
Direxion Daily Junior Gold Miners Index Bull 3x ETF
- Nearest Resistance: $9.50
- Nearest Support: $7.50
- Catalyst: Spot Gold
The Direxion Daily Junior Gold Miners Index Bull 3x ETF (JNUG - Get Report) found itself near the top of the NYSE's most actively traded stocks yet again this week, adding 10.6% to its price tag since the start of the week. JNUG is a leveraged bet on gold miners, which makes it a volatile way to play metals prices - and not a particularly attractive name to see in your portfolio lately. As gold prices have rolled over since last summer, JNUG has been trending lower. But this exchange-traded fund is trying to carve out a bottom in January, and shares look like they're finally within grabbing distance of triggering an inverse head and shoulders pattern. If JNUG can break through resistance at $9.50, we've got a new buy signal in this stock.
- Nearest Resistance: $18
- Nearest Support: $12.50
- Catalyst: Share Offering
Mid-cap energy stock WPX Energy (WPX - Get Report) finished last week on big volume, correcting slightly following the announcement that the company was upsizing its planned share offering to 45 million shares from 42 million shares, with proceeds expected to be $600.8 million. The offering is expected to close on January 19.
Technically speaking, WPX looks attractive. Shares have been in a well-defined uptrend for the better part of the last year, bouncing higher on every test of trendline support to-date. Now, as this stock retreats back down towards trendline support for a fifth time since last April, it makes sense to be on the lookout for the next bounce higher. A bounce is a buy signal in WPX.
Fiat Chrysler Automobiles
- Nearest Resistance: $11
- Nearest Support: $9
- Catalyst: Criminal Probe Talks
It's been a tough week for shares of Fiat Chrysler Automobiles (FCAU - Get Report) . Shares of the $13 billion automaker have shed more than 12% of their market value since Thursday, dropping on news that the firm could face a U.S. criminal emissions probe following an EPA report that the agency had found software in certain Fiat Chrysler models designed to allow those cars to exceed pollution limits. Investors have been selling Fiat Chrysler in fear that the firm could see significant consequences - much like the more-than $20 billion that similar emissions cheating has cost Volkswagen AG so far.
From a technical standpoint, Fiat Chrysler is down, but it's not out. Shares are pulling back to test trendline support, currently at $9. As long as that $9 line in the sand holds up in FCAU, dips in this car maker look like buying opportunities, not cause for panic.
- Nearest Resistance: $14.75
- Nearest Support: $14
- Catalyst: Technical Setup
A bullish technical setup helped to propel shares of $18 billion banking stock Regions Financial (RF - Get Report) 1.73% at the end of Friday's session, as shares close in on breakout territory. Since December, Regions has been forming an ascending triangle pattern, a bullish continuation setup that's formed by horizontal resistance up above shares at $14.75, and uptrending support to the downside. Basically, as Regions pinballs in between those two technically significant price levels, shares have been getting squeezed closer and closer to a buy signal - that's good reason to keep a close eye on $14.75 in the week ahead.
- Nearest Resistance: $15
- Nearest Support: $13
- Catalyst: Q3 Earnings
Last on our list of the week's high-volume stocks is Infosys (INFY - Get Report) . Infosys ended the week on a rough note, shedding just under 5% in Friday's session thanks to third quarter earnings results. Infosys beat earnings estimates slightly for the quarter, but a cut to full-year sales guidance is what drove Friday's downside.
Long term, Infosys has been stuck in a downtrend since last Spring, getting swatted lower on every test of the top of its price channel so far. That bearish price trajectory makes this stock a name you don't want to see in your portfolio this winter -- consider this latest bounce off of resistance a selling opportunity.