Offload Now: 5 Stocks To Sell

The basic core principles of investment and trading have stayed largely the same over the last few decades.

However, with modern technology and social media networks providing increased connectivity, they are blurring infrastructural and national boundaries, and the so-called ‘crowd’ effect has now entered the world of investment and trading.

Many market players are turning to these networks and social media platforms for advice and guidance on stocks that are worth keeping an eye on.

In the industry, it’s called crowdsourcing.

The term first came around when creative types would use social media platforms to raise funds for projects.

In this context, it means looking at the crowd for guidance on where to allocate your funds by identifying trends that appear in markets as they occur.

Long a popular tool for the advertising and marketing industries, it is logical that it has entered the investment fray.

There is no better measure of supply and demand than looking at the numbers of those very things and seeing what is on trend and what is not so hot.

Some portfolio managers and traders try to harness social media tools like Twitter and Facebook for trading opportunities by tracking movements in popular opinion.

However, crowdsourcing, as this article will explain, is best taken advantage of as a start point for the savvy investor in their analysis.

What follows is an analysis of some of the liveliest stocks on the current market.

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VelocityShares Daily 2x VIX Short-Term ETN

Closest Resistance: N/A

Closest Support: N/A

Catalyst: The New S&P 500 Highs

A stock that is in stark decline is the VelocyityShares ETN or TVIX for short.

TVIX is a note traded that tracks twice the return of the adjoining VIX Volatility-based index.

The index is essentially something which measures fear in the market climate.

Historically, it enjoys a pretty strong inverse correlation regarding the S&P 500 index’s price performance.

This is to be expected.

The more fear in a market, the worse the stocks will perform, as in markets of this magnitude, perception and feeling are incredibly important.

So while we saw the S&P set record highs last week, the TVIX has been performing quite badly.

And technical analysis-based tools and guidance don’t apply to this stock either, hence the N/A entries for resistance and support.

This is because TVIX is not a conventional exchange-traded note: its price action is dictated by a statistical formula rather than the normal demand and supply from the market’s participants.

So, while the stock has performed well previously, as long as the S&P is doing well, you don’t want to be the person with shares of declining TVIX.

Sagent Pharmaceuticals

Closest Resistance: $21.68

Closest Support: $21.50

Catalyst: Acquisition

Sagent Pharma is a small-cap drug producer (small cap means a relatively small company, one with small market capitalization).

It is notable that it was one of the most traded stocks on the Nasdaq last week, showing consistently high-volume issues.

After the Japanese pharma giant Nicho-Iko Pharmaceuticals had announced an agreement to purchase Sagent for a solid $21.75 a share, in cash, the stock climbed the charts and finished at around 40% higher on Tuesday morning.

This pushed the stock to almost par with the mentioned offer price.

The deal valued the firm at around $715 million.  

Thus, there isn’t much of a discount to our deal price, and Wall Street has ended up pricing in a very strong change that the proposed deal with go through as planned.

If you are lucky enough to have shares in Sagent, then you will already be reeling in the profits with its upturn, and so you may as well sell now.

Regarding this goose, the golden eggs have hatched, and you should look elsewhere for the next big one.

Freeport-McMoRan

Closest Resistance: $12

Closest Support: $10

Catalyst: Metals Prices

Freeport-McMoRan, abbreviated as FCX, is seeing strong performance, thanks to a general increase in the price of metals, and saw its shares up 5% as of Tuesday last week.   

However, in the long term, Freeport’s technical capabilities for strong stock performance are beginning to show structural weakness.

Its stocks have been shooting up for most of 2016, up by a whopping 75% in 2016 from its start point.

However, the graph shows a descending triangle recently, which is a sure sign that you should sell.

Do so if shares violate the support levels of $10.

Or for the daring buyer, you could break shares out at a price higher than $12, which will get rid of any bearish sentiment.

This would make the hovering under $12 significant.

Jazz Pharmaceutical

Using data from Investor Place, this is another stock we advise you sell.

This week, it slipped from a C rating to a D rating, after a very strong performance from March to May (as shown above).

Since then, it has not fared so well.

JAZZ are a pharmaceutical company that specialize in developing and marketing products that meet the increasing needs in neurological and psychiatric illnesses and diseases.

Currently trading down 1%, at $140.74 per share.

GameStop Corporation

It’s been a bad week, and a bad year generally for GameStop.

Their company rating has fallen down from D to F in only seven days on Investor Place.

If you’re not familiar with them, they are a specialty video game and electronics retailer operating in North America, Europe, and Australia.

The stock is currently trading at $28.83 per share.

Final Word

Various signs of a turnaround in the market have been seen, aside from the rally since Brexit, which has seen record highs.

Small-capitalization stocks are currently on fire.

Some say that investors are actually viewing Brexit positively.

Britain’s decision caused havoc at first, but all the noise surrounding it has led some to believe it will not be fully implemented, a perception which has calmed much of the initial furor.

Though there is still plenty to be skittish about for investors.

Nonetheless, some strategists, such a Peter Kenny, believe that stocks have more room to run into, and we could see further highs.