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.
This recent high-flyer looks vulnerable. With poor money flow and expanding volume to the downside there is little safety here for the operator of digitized brokerage and wealth management platforms.
Moving Average Convergence Divergence (MACD) just crossed for a bearish signal, and the trend line shows a target down to the $35 level.
That would be a nice 18% move down. Put in a stop at $46 just in case, but look for a move down the mid-$30s.
Recent entry into the Dow Jones Industrials hasn't helped this biotech name. Amgen has been plagued by high volatility, strong volume and poor price action. The Relative Strength Index (RSI) is meh, while the money flow is quite bearish and has been for six weeks.
Resistance just hit last Wednesday at the 50-day moving average; this stock is headed at least down to $215 and probably a bit lower. The cloud is red and recent volume trends on the recovery are weak.
If short, put in a stop at $230 or so and stay short.
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.