Using recent actions and grades from TheStreet's Quant Ratings and layering on technical analysis of the charts of those stocks, Trifecta Stocks identifies five names each week 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.
CIT Group
CIT Group Inc. (CIT) recently was downgraded to Sell with a D rating by TheStreet's Quant Ratings.
This credit firm's chart has a bearish triangle. A break lower, which is probable here, sets up a move down to the March lows. THe Relative Strength Index (RSI) is weak and bending lower and resistance above is all over the place, starting with the lower edge of the cloud.
If short, put in a stop around $24 and look to ride this out to the low teens. The chart is pretty bearish here.
Penske Automotive
Penske Automotive Group Inc. (PAG) recently was downgraded to Hold with a C rating by TheStreet's Quant Ratings.
The automotive and commercial truck retailer had a nice rally off the lows but looks to be in trouble here. We see lower highs and lower lows in the RSI, and momentum has stalled out as well (bottom pane).
Volume trends are bearish and weak, and the Moving Average Convergence Divergence (MACD) is about to roll over, too. The cloud is red and we could see this roll right over to the March lows.
If short, put in a stop at $32 but enjoy the ride down to the low $20s.
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.
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