TradingMarkets Morning Stock Movers
Stocks got off to a sluggish start on the first trading day of the week following Friday’s steep sell-off. This means, among other things, that many of the opportunities we saw near the end of last week still remain for traders looking to buy stocks on sale this week.
All but one of the five stocks in today’s report have Short Term PowerRatings of 9. Our research into short term stock behavior indicates that stocks with Short Term PowerRatings of 9 have outperformed the average stock by a margin of more than 13 to 1 after five days. This makes 9-rated stocks among the best opportunities for traders working in the short term “sweet spot” of 5-8 days.
Not only are all the stocks presented here high, Short Term PowerRatings stocks (the one stock that does not have a 9-rating has a respectable rating of 8), but also all five stocks have been down by 10% or more over the past five days. Looking at millions of short term, simulated stock trades from 1995-2007, we learned that stocks that were trading above their 200-day moving averages AND had lost 10% or more in a short period of time, tended to outperform the average stock in one-day, two-day and one-week timeframes.
When combined with the sort of high Short Term PowerRatings we see here, we have a set of stocks that short term stock traders will want to keep an eye on over the next few days.
So, let’s take a look at the stocks.
Cytori Therapeutics Inc.
(
CYTX |
Quote |
Chart |
News |
PowerRating) Short Term PowerRating 9. RSI(2): 2.54
Shares of CYTX began moving lower in the second week of June, but it was not until Friday that the stock truly broke down in earnest, dropping from just under $7.50 to just under $6.50 in a single session. As of this morning, CYTX continues to move lower, testing its 200-day moving average on an intraday basis and potentially providing an attractive entry as the stock’s 2-period RSI slips below 2.
Lindsay Corporation
(
LNN |
Quote |
Chart |
News |
PowerRating) Short Term PowerRating 9. RSI(2): 5.53
LNN was early to the sell-off party last week, gapping down dramatically on the Wednesday following Friday’s broad-based move lower. Since then, shares of Lindsay Corporation have moved sideways, which has begun to take some of the oversold “sting” out of the market for this stock.
U.S. Concrete Inc.
(
RMIX |
Quote |
Chart |
News |
PowerRating) Short Term PowerRating 9. RSI(2): 2.32
Also rounding over in early June were shares of U.S. Concrete Inc, which ran out of buying momentum after testing the $6.50 level. The move lower in RMIX has been less dramatic than that in, for example, CYTX, but the stock has become nicely oversold all the same with a 2-period RSI of 2.32. Note that some intraday strength early on Monday has helped relieve some of this oversold pressure – and bring the 2-period RSI up higher than it was on Friday. But the fact remains that RMIX is a significantly oversold stock, having closed down for the past four consecutive sessions leading into Monday.
STEC Inc.b
(
STEC |
Quote |
Chart |
News |
PowerRating) Short Term PowerRating 9. RSI(2): 1.22
Speaking of consecutive selling days, there is quite a bit of profit-taking that continues in shares of STEC, which sold off for five consecutive trading days going into Monday’s trading. In fact, if you want the definition of an oversold stock, it would be hard to find a stock that has been more overrun with sellers than STEC, which has closed down for 11 out of the past 12 sessions.
Accordingly, the stock’s 2-period RSI has moved as low as 1.22 on Friday before bouncing somewhat with a bit of buying on Monday.
Level 3 Communications Inc.
(
LVLT |
Quote |
Chart |
News |
PowerRating) Short Term PowerRating 8. RSI(2): 2.34
Having only recently climbed up out of the pit that is life under the 200-day moving average, will shares of Level 3 Communications be able to stay on top? LVLT broke out above its 200-day moving average in the second half of May, rallied from approximately $3.40 to $4.40 before pulling back toward the 200-day moving average level. This pullback has been deep enough to drive the stock’s 2-period RSI below 3 – and even lower so far in trading on Monday.
Does your stock trading need a tune-up? Our highest Short Term PowerRatings stocks have outperformed the average stock by a margin of nearly 17 to 1 after five days.
| Click here to start your free, 7-day trial to our Short Term PowerRatings! |
Whether you have a trading strategy of your own that could use a boost or are looking for a way to tell the stocks that will move higher in the short term from the stocks that are more likely to disappoint, our Short Term PowerRatings are based on more than a decade of quantified, backtested simulated stock trades involving millions of stocks between 1995 and 2007. Click the link above or call us at 888-484-8220, extension 1, and start your free trial today.
David Penn is Senior Editor at TradingMarkets.com.