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 provider of over-the-counter medications shows a bearish chart formation, a head-and-shoulders pattern that continues to play out. Moving Average Convergence Divergence (MACD) is on a sell signal while money flow has turned bearish. The Relative Strength Index (RSI) is a steep slope downward; that is bearish.
The price action confirms the poor chart, and while some support is near at $44 this stock could fall to the March lows. If short, put in a stop at $49 but run it down to the high $30s.
This medical supplier is wild and crazy. The chart shows lots of volatile action and is mostly sideways. However, the indicators are piling up on the bearish side and there could be more down to go.
Volume is strong this month as the stock is distributed; the cloud is red and expanding. That is a bearish sign.
MACD is already on a sell signal, so if short target the $200 area but put in a stop at $240 or so.
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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— Bob Lang and Chris Versace are co-portfolio managers of Trifecta Stocks.
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