Trifecta Stocks is a long-only model portfolio, but we are anxious to give our subscribers insight into stocks that may pose interesting investing opportunities on the short side.
Using recent actions and grades from TheStreet's Quant Ratings and layering on technical analysis of the charts of those stocks, we will identify five names each Friday that look bearish. 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.
Molson Coors Brewing (TAP) recently was downgraded to Hold with a C rating by TheStreet's Quant Ratings service. Meanwhile, the stock got blasted a week or so ago on poor earnings and continues to be in a tailspin.
As can be seen in the chart above, TAP's Moving Average Convergence Divergence (MACD) indicator is on a solid sell signal. A look at the weak relative strength indicates that big money is not interested in this name here.
Resistance is all over the place with a downtrend line and gaps, while the momentum is very weak. Sell any rally.
Looking at the chart, above, this medical company has seen better days as its gap lower was painful and on huge turnover.
Cardinal missed on earnings and the stock was punished severely for it. MACD is on a fresh sell signal here and there is gap resistance way ahead.
The stock could be sold on any rally and from this bear flag.
Want to find out the three other big-name stocks we think look good short this week and how to play them? Click here for a trial subscription to Trifecta Stocks and get "5 Bearish Bets" each week!
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.
-- Bob Lang and Chris Versace are co-portfolio managers of Trifecta Stocks.