As of midweek, the Nasdaq 100 featured some of the highest quality, short-term pullbacks in the stock market. With stocks like Hansen Natural (NASDAQ: HANS) down four out of five trading days and shares of Cisco Systems (NASDAQ: CSCO) slipping after a three-day bounce, traders and active investors alike soon could see a number of opportunities to take advantage of short-term weakness in the context of long-term – or at least, intermediate-term – strength.
Pulling back into oversold territory in mid-December, shares of HANS rallied by more than 5% over the next three trading days. During the sell-off, Hansen Natural had finished lower for four days in a row, with two finishes at levels where buyers historically have been attracted to the stock. The current pullback in HANS has put the stock at an even more oversold level than it was during Hansen’s mid-month correction. Shares finished lower by more than 3% on Wednesday.
Also trading in oversold territory ahead of Thursday’s open are shares of Randgold Resources Ltd (NASDAQ: GOLD). GOLD now has closed lower for four out of the past five sessions after dropping by well over 1% on Wednesday. And like Hansen Natural, Randgold Resources was last trading these levels in the middle of December, finishing oversold for two days in a row before bounding higher by 7% over the next three sessions.
Other Nasdaq stocks for traders and active investors to keep their eyes on include Perrigo Co. (NASDAQ: PRGO), down three out of the past four and nearing oversold territory above the 200-day moving average. The most recent pullback in PRGO was less than two weeks ago, when a sell-off that took the stock lower for six out of seven trading days was followed by a rally of nearly 7% over the following week.
HANS has a short-term, positive edge of more than 1%, with both GOLD and CSCO earning edges of well over half a percent. The Nasdaq Composite is short-term oversold after selling off by more than 1% on Wednesday. The selling in the Nasdaq comes after a three-day rally took the index to the brink of overbought territory below the 200-day moving average. Basis the PowerShares QQQ ETF (NASDAQ: QQQ), the Nasdaq 100 was sent back into bear market territory after rallying above its 200-day during its advance this week.
All of the stocks in today’s report were available from research and data available through The Machine. To learn more, click here.
David Penn is Editor in Chief of TradingMarkets.com