6 Hot Stocks on Traders' Radars
From hedge funds to individual investors, scores of market participants are turning to social media to figure out which stocks are worth watching. It's a concept that's known as "crowdsourcing," and it uses the masses to identify emerging trends in the market. While crowdsourcing has long been a popular tool for the advertising industry, it makes a lot of sense as an investment tool -- after all, the market is completely driven by the supply and demand, so it can be valuable to see what names are trending among the crowd.
While some fund managers are already trying to leverage social media resources such as Twitter to find algorithmic trading opportunities, for most investors, crowdsourcing works best as a starting point for traders who want a starting point in their analysis.
Today, we'll leverage the power of the crowd to take a look at six of the highest-trending stock searches on Google.
Here's a look at how these most-searched names are trading technically .
Nearest Resistance: $28
Nearest Support: $24
Catalyst: Store Closures, Earnings
Tech retailer Best Buy (BBY) is struggling today, pushed lower by news that the firm is taking drastic steps to right its business. The firm posted a loss of $1.7 billion for the fourth quarter, dipping dramatically lower from last year's fourth quarter on significant restructuring costs.
CEO Brian Dunn announced the firm will be closing 50 stores as part of its restructuring and will be testing new formats in two cities to better compete with online rivals. The commoditization of tech retail is eating into Best Buy's business in a big way.
As painful as today's 7% pullback may be, it's not a technically significant price move. Shares of BBY are still sitting above support at $24, and they're still actually up on the year.
Best Buy isn't really in the danger zone until shares break below a more critical support level at $22.50. While it makes sense for traders to wait for consolidation before buying, shareholders don't need to panic just yet.
Nearest Resistance: N/A
Nearest Support: $54
Catalyst: Positive Earnings
Meanwhile, software firm Red Hat (RHT) is rallying hard today following a fifth-straight quarter of earnings that stomped Wall Street's expectations. Red Hat is up more than 18% as I write, following earnings of 18 cents per share for the fourth quarter.