These recently downgraded names are displaying both quantitative and technical deterioration.
Stocks quotes in this article:
Each week we identify names that look bearish and may present interesting investing opportunities on the short side.
Using technical analysis of the charts of those stocks, and, when appropriate, recent actions and grades from TheStreet’s Quant Ratings, we zero in on three names.
While we will not be weighing in with fundamental analysis, we hope this piece will give investors interested in stocks on the way down a good starting point to do further homework on the names.
T. Rowe Price Isn’t Right Right Now
This investment manager has a long series of lower highs and lower lows on the chart. While a few of the indicators are flagging bullish, the price action is not all there.
Though we do see a modest penetration of the downtrend line, it appears this stock is about to roll over. The RSI is poor and still bending lower.
This stock could get under the magic $100 number soon enough; target $97 or so, put in a stop at $128 just in case.
Valmont Industries Swings and Sways
The maker of metal fabricated product is truly the art of the chop. This chart is all over the place with plenty of volatility.
Though some of the indicators have turned up, the RSI is not and volume trends are still bearish. That means Valmont is likely headed to the lower trend line, let’s call it $220 or so. That would be a nice 10% move down.
Put in a stop at $245 (gap fill) just in case we are wrong.
Cooper Companies Loses Focus
The vision care company is a repeat offender, the stock driven sharply lower in April and sporting lower highs and lower lows. The recent bounce is a good spot to enter a short play as volume on that bounce has been suspect, which signals a lack of commitment from buyers.
Money flow is positive, but the Relative Strength Index (RSI) resistance at the 50 level is tough to overcome.
Let’s put in a short here at $307 or so and target the $275 area, with a stop at $325 just in case.
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