Bearish Bets: 3 Stocks Ripe for Shorting This Week
These hard-hit shares are displaying bearish tendencies and charting a path downward.
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Let's check three stocks that appear technically bearish and look ready to short.
While we will not weigh in with fundamental analysis on these issues, we will pop the hood for a look at the charts.
Let's dig in.
Verint Just Falls Off a Cliff After Poor Earnings
No question a stock within a downtrend has plenty to prove. When earnings come around the "result" is often already priced in. But if the results are worse than expected then the stock is vulnerable to more downside action, much like Verint Systems VRNT this past week.
The trend is clearly down, with lower highs and lower lows. Check out that bearish money flow, so negative that it appears big money is just unloading the stock in bulk.
On balance volume (bottom pane) is weakening as the big money continues to pull out, while MACD (moving average convergence/divergence) is on a sell signal.
What now after a sharp move lower? Play the trend, which is down. We'll set a target of $12 and then $9, and put in a stop at $19 just in case.
AppLovin Is No Longer Feeling the Love
What a miserable couple of months for AppLovin APP. The name rocketed higher last year, soaring higher with strong earnings and momentum. Recently, however, the stock has fallen sharply, as some analyst firms came out with negative views of the company.
Since early February AppLovin has dropped about 40% on very heavy volume, with the big money escaping from the carnage.
This past week saw a massive down day that put APP in the the crosshairs. The triangle was broken (seen here) to the downside on heavy volume. That is big money cutting the stock at whatever price.
The indicators are mixed with the RSI (relative strength index) bending lower and the MACD on a sell signal. With the strong bearish volume trends this stock will at least make a run to the 200-day moving average at around $235, so let's target that for now, and put in a stop at $320 just in case.
General Motors' Chart Is Running Out of Gas
The mention of tariffs on autos this past week sent chills down the spine of automakers and their stocks. Just look at the mess that is General Motors GM, which had been working to climb back up following a swing low.
The indicators are pretty balanced, with the Money Flow and on balance volume bullish. However, the price action is weak and that brings some concern.
That gap is huge and on big turnover Thursday, leading us to believe more downside action is upon us. That RSI rolled over like dough on a table — just terrible action.
The gap from January is yet to be filled, so we see downside to the August lows at $38 or so and then we can re-assess.
