Markets are ending the week on a strong note today, the big S&P 500 shoving its way to new all-time highs early in Friday's session.
That's obviously a good thing for stock market investors--but it's hardly the end of the story. Even though the big market averages are hitting new high-water marks, there's a very large chunk of this market that's not participating in the upside.
For instance, while the S&P is up more than 9% year-to-date, one in three S&P 500 components is actually down in 2017. If you've owned these "toxic stocks" this year, you've had a colossal drag on your portfolio performance.
Now, as we head toward the second half of 2017, the key to beating the market isn't finding the very best stocks to own; instead, the key is just not owning the stocks that could drop further from here. To accomplish that, we're turning to the charts for a technical look at three stocks that are about to trigger sell signals (and when you should actually sell them).
Just so we're clear, the companies I'm talking about are hardly junk--many of them have very strong businesses.
But that's frankly irrelevant to what happens to their stocks; from a technical analysis standpoint, sellers are shoving around these toxic stocks right now. For that reason, fundamental investors need to decide how long they're willing to take the pain if they want to hold onto these firms in the weeks and months ahead. And for investors looking to buy one of these positions, it makes sense to wait for more favorable technical conditions (and a lower share price) before piling in.