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.
F5 Networks Inc. (FFIV) recently was downgraded to Hold with a C+ rating by TheStreet’s Quant Ratings.
The provider of cloud application services fell hard on some whopping volume. A follow-through day cinches the downside, and with a moving average convergence divergence (MACD) sell signal in place and Relative Strength Index (RSI) rollover this stock is in trouble.
F5 is a volatile name but it certainly can run to targets. The gap below the 100-day moving average spells doom and a likely move down to the 200-day moving average around $170. Put in a stop at $200 just in case.
Cabot Oil & Gas
Cabot Oil & Gas Corp. (COG) recently was downgraded to Hold with a C+ rating by TheStreet’s Quant Ratings.
Oil-and-gas names have led a resurgence in energy, but this stock got pounded in April and is barely able to make back lost ground. Notice the weak volume trends here with a bearish money flow and weak MACD chart. The cloud is still red and Cabot is below that level, a bearish development.
While there is not much meat left on this bone, a run back to $15.50 is not out of the question, which would be about a 10% move down. Put in a stop at $18.
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.
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