5 Big Stocks to Trade (or Not)

BALTIMORE (Stockpickr) -- Put down the 10-K filings and the stock screeners. It's time to take a break from the traditional methods of generating investment ideas. Instead, let the crowd do it for you.

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From hedge funds to individual investors, scores of market participants are turning to social media to figure out which stocks are worth watching. It's a concept that's known as "crowdsourcing," and it uses the masses to identify emerging trends in the market.

Crowdsourcing has long been a popular tool for the advertising industry, but it also makes a lot of sense as an investment tool. After all, the market is completely driven by the supply and demand, so it can be valuable to see what names are trending among the crowd.

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While some fund managers are already trying to leverage social media resources like Twitter to find algorithmic trading opportunities, for most investors, crowdsourcing works best as a starting point for investors who want a starting point in their analysis. Today, we'll leverage the power of the crowd to take a look at some of the most active stocks on the market today.

These "most active" names are the most heavily-traded names on the market -- and often, uber-active names have some sort of a technical or fundamental catalyst driving investors' attention on shares. That's especially true now that earnings season is officially underway. And when there's a big catalyst, there's often a trading opportunity.

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Without further ado, here's a look at today's stocks.

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J.C. Penney

Nearest Resistance: $9

Nearest Support: N/A

Catalyst: Fitch Downgrade

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Things aren't looking so hot at department store chain J.C. Penney (JCP). Shares of the mall staple have gotten hammered 57% lower since the calendar flipped over to January, and they're still in free-fall now. Today's 2% decline comes on the heels of a downgrade from credit ratings firm Fitch that knocked JCP's debt to junk status.

JCP's chart is the definition of a "falling knife" right now. Investors who try to call the bottom on this stock are likely to get a pricey lesson for their trouble.

Rite Aid

Nearest Resistance: N/A

Nearest Support: $5

Catalyst: Same Store Sales Boost

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Pharmacy chain Rite Aid (RAD) is up 3.2% in this afternoon's session after posting same store sales for September that impressed Wall Street. Compared with last year, RAD's stores network-wide saw sales ramp up 1.9% in September to $1.935 billion. That's enough to extend RAD's rally to new highs this afternoon.

Making new highs is significant from an investor psychology standpoint because it means that everyone who has bought shares in the last year is sitting on gains. As a result, the "back to even" mentality is less of a concern than it would be for a name with a higher proportion of shareholders sitting on losses. Traders who aren't risk-averse may want to consider jumping in here; just keep a tight stop in place.

Tesla Motors

Nearest Resistance: $194.50

Nearest Support: $170

Catalyst: Downgrade, Fire

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Tesla Motors (TSLA) has been one of the momentum stories of the year, rallying more than 400% since the start of 2013. But shares are correcting hard this afternoon for a second straight day after the one-two punch of a viral video and a downgrade from Baird. Yesterday, a video of a flaming, crashed Tesla Model S had investors hitting the "sell" button on speculation over the source of the flames (Tesla later confirmed that they were caused by a collision, but the damage to shares had been done.)

At this point, TSLA is sitting right above a meaningful support level at $170. That's likely to act as a near-term floor unless headline risk creeps into this stock's price. There's no question that this stock is pricey right now, but it could be due for a bounce.

Angie's List

Nearest Resistance: $20

Nearest Support: $18

Catalyst: Price Cuts

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Last up is Angie's List (ANGI), the small-cap service review community. Angie's List is getting shellacked in this afternoon's session after news hit that the firm was slashing prices as much as 75% is some key markets to spur member growth. Investors are treating the move as a desperate one, and ANGI is off by almost 15% today as a result.

From a technical standpoint, ANGI is in make-or-break mode. Shares are extremely close to $18 support, and where they end up closing today will have a big impact on whether more downside looks likely. From there, $16 is the next-lowest cushion for shareholders. Zooming out to the longer-term, this stock looks "toppy" -- I'd stay away from shares.

To see these stocks in action, check out the at Most-Active Stocks portfolio on Stockpickr.



-- Written by Jonas Elmerraji in Baltimore.

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At the time of publication, a portfolio managed by the author was long TSLA.

Jonas Elmerraji, CMT, is a senior market analyst at Agora Financial in Baltimore and a contributor to

TheStreet. Before that, he managed a portfolio of stocks for an investment advisory returned 15% in 2008. He has been featured in Forbes , Investor's Business Daily, and on CNBC.com. Jonas holds a degree in financial economics from UMBC and the Chartered Market Technician designation.

Follow Jonas on Twitter @JonasElmerraji