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 three 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.
MarineMax Isn’t Floating Traders’ Boats
The boat and yacht retailer is a new name but is showing those bearish qualities that are ripe for a short play. The recent downtrend is lengthy and has damaged the chart; when the 35 level broke it was like the dam exploding.
Money flow is poor while the cloud is red — that is bearish. We notice the bear flag created with this week’s pull-up in price, a nice low-risk entry point to set a trap.
If short, take this trade down to the low $20s, put in a stop at $35 just in case. It’s a good-looking chart for a short.
Scholastic Is Taken to School
The producer of children’s books and educational materials is a repeat offender, as it has shown up at least two other times in this feature. To say Scholastic is volatile would be an understatement. Look at that surge in July and the equally impressive waterfall collapse in September. The volume trends are strong and bearish now, with the very steep down move and no buyers in sight.
Money flow is negative and the moving average convergence divergence (MACD) is on a sell signal. Relative strength is bending lower at a steep slope and is oversold, so any rally in this name is another good chance to short. For now, set a target of $22, put in an aggressive stop at $33.
Newell Brands Looks Old and Tired
The diversified maker of consumer and commercial products is another repeat offender here and has fallen sharply on pretty strong turnover. Money flow is extremely negative and the Relative Strength Index (RSI) is oversold, so Newell may have a relief rally soon. That’s fine, as it’s another spot to get on board a short position.
MACD is on a sell signal and the moving averages are bending lower. If short, target the $8 area, put in a stop at $18. This one could be a nice winner.
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