These names are displaying both quantitative and technical deterioration.
Stocks quotes in this article:
Each week Trifecta Stocks identifies names that look bearish and may present interesting investing opportunities on the short side.
Using technical analysis of the charts of those stocks, and, when appropriate, recent actions and grades from TheStreet’s Quant Ratings, we zero in on five names.
While we will not be weighing in with fundamental analysis, we hope this piece will give investors interested in stocks on the way down a good starting point to do further homework on the names.
What goes up eventually comes down, and that happened fast for this developer of networking technology. This chart has totally broken as the sellers are scrambling to get out.
The big volume surge with the stock getting pounded recently is evidence enough, but downside follow-through tells the story. A Moving Average Convergence Divergence (MACD) sell signal and money flow is negative — need we say more?
This stock has a date with the 200-day moving average if not lower. Put in a stop at $340 and ride it to $230 or so.
This enterprise software company really got hammered in February and there is little in the way of support right here. The stock is struggling to mount a rally past the 200-day moving average, and that will eventually spell trouble.
Money flow is weak and the cloud is wide and red; sellers are still not finished. A generous stop is probably warranted, at about $250 or so, but look for a move down to $200 or even lower.
This chart clearly is bearish.
This commentary is an excerpt from “5 Bearish Bets” a weekly feature sent to subscribers of Trifecta Stocks. Click here to learn more about this portfolio, trading ideas and market commentary product.
Want to find out the other stocks we think look good short this week and how to play them? Click here for a trial subscription to Trifecta Stocks and get “Bearish Bets” each week!
— Bob Lang and Chris Versace are co-portfolio managers of Trifecta Stocks.
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