Each week, we identify names that look bearish and can present attractive short-side investment opportunities.
Using technical analysis from those stocks’ charts and, where applicable, recent stocks and ratings from TheStreet’s Quant Ratings, we focus on three names.
While we won’t be weighing in on fundamental analysis, we hope this piece gives investors interested in downhill stocks a good starting point to do more homework on the names.
Sysco Corp. (SYY) is classified is classified a Jack with a C+ rating from TheStreet’s Quant Ratings.
SYY shows us a graph of a stock ready to go down. The recent move towards the apex of this triangle has been quite bearish, with heavy volume on that big candle day.
That was one bad session and another followed. We see the money flow to be bullish, and that is probably the best and only positive indicator.
The Relative Strength Index (RSI) is lowering as we have the Moving Average Convergence Divergence (MACD) poised to move into a sell signal.
We could see a run down to $70 and possibly $69, as the cloud is also red. Put a stop at $81 just in case.
A bear flag flies here
Calix Corp. (CALX) is classified is classified a Jack with a C+ rating from TheStreet’s Quant Ratings.
Calix has formed a bearish flag here, and with high volume on the recent move down there is tremendous pressure on the stock.
Notice the bearish money flow and the MACD sell signal in progress. This is significant and the gap that has opened since July begs to be filled. It comes in at $45, a nice 14% drop from current levels.
Let’s target that area, stop at $56.50, just above the 200-day moving average in case the buyers return. I highly doubt that will happen.
It is difficult to bring a downtrend back into the tube
Colgate-Palmolive is rated is rated Jack with a C+ rating from TheStreet’s Quant Ratings.
Colgate shows us a steep downtrend channel, with lower highs and lower lows. Also, the stock has recently fallen through the 50-day and 100-day moving average and the 200-day moving average with heavy turnover.
That heavy selling is not reconsidered and prices continue to fall. The recent pull-up looks like a bearish flag formation and a great low-risk entry point on a short play.
Target the $70.90 area; stop at $77 just in case.
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