Each week Trifecta Stocks identifies 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 five 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.
21Vianet Group
21Vianet Group Inc. (VNET) recently was downgraded to Sell with a D rating by TheStreet’s Quant Ratings.
The Chinese provider of Internet data center services has come down sharply since the start of 2021 with some good volume to boot. That means the big money is cutting and running, which is not good news if you’re a bull.
Money flow has been bearish for months now and the Relative Strength Index (RSI) has touched oversold for the seventh time. That’s clearly not a buy signal as previous touches were sold, too. Bad news all around and the cloud is red and expanding.
There is plenty more meat on this bone; take the short and ride it to $12 or so, but put in a stop at $24.
Fidelity National Information Services
Fidelity National Information Services Inc. (FIS) recently was downgraded to Hold with a C+ rating by TheStreet’s Quant Ratings.
The technology provider to banks and capital market firms is showing a defined downtrend channel of lower highs and lower lows. That has been set up by stronger turnover, and check out the money flow — it’s overwhelmingly bearish.
The moving averages have not acted as support; the stock sliced right through them with ease. The trend is clearly down.
Look to see a break of $140 or so, targeting the gap at $134 or lower. Put in a stop at $147 just in case.
This commentary is an excerpt from “Bearish Bets” a weekly feature sent to subscribers of Trifecta Stocks. Click here to learn more about this portfolio, trading ideas and market commentary product.
Want to find out the other stocks we think look good short this week and how to play them? Click here for a trial subscription to Trifecta Stocks and get “Bearish Bets” each week!
— Bob Lang and Chris Versace are co-portfolio managers of Trifecta Stocks.
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