Using recent actions and grades from TheStreet Quant Ratings and layering on technical analysis of the charts of those stocks, Trifecta Stocks identifies five names each Friday that look bearish.
While we will not be weighing in with fundamental analysis, we hope this piece gives investors interested in stocks on the way down a good starting point to do further homework on the names.
Skechers
Skechers U.S.A. (SKX) recently was downgraded to Hold with a C+ rating by TheStreet's Quant Ratings.
Skechers got blasted last month as the company once again missed earnings. This stock tends to move in a big way on events, so that was no surprise. Momentum is starting to turn down here and while volume is not high, price action is suspect. Relative Strength (RSI) is flat to poor.
A move back to the lower Bollinger around $27 would be a good time to short the stock. Resistance lines are drawn and show a brick wall at $30.
Brinker International
Brinker International (EAT) recently was downgraded to Hold with a C rating by TheStreet's Quant Ratings.
Brinker was on a nice roll this spring making a high in June, but it has now rolled over, along with the indicators. Notice the downtrend channel as price slopes toward the 200-day moving average (arrow). This series of lower highs could prove to be quite a mess if that 200 MA is penetrated.
Momentum is waning and is barely clinging to modest/neutral, but a move lower to the bottom of the channel is likely, about 5% down from here. This is a good short to $41.
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 three 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 "5 Bearish Bets" each week!
-- Bob Lang and Chris Versace are co-portfolio managers of Trifecta Stocks.
