Bearish Bets: 3 Stocks You Should Really Consider Shorting This Week
These names are displaying bearish tendencies based on their technical patterns.
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Welcome to another edition of TheStreet Pro's Bearish Bets, our weekly feature where we identify three stocks that look bearish from a technical perspective and may present interesting investing opportunities on the short side.
While we will not be weighing in with fundamental analysis on these issues, 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 contained herein.
Nobody Is Eating Out at Brinker
In case you were wondering, Brinker EAT is the holding company for a few restaurants, with the big name being Chili's. After a nice rise up in May the stock flattened out and recently was hit rather hard on heavy volume. That was this week when earnings hit; the company missed the mark and mentioned the consumer is slowing down.
The gap down was pretty serious, and there was heavy turnover on that day. Follow through is always important though, and if the market is strong while this stock languishes then it is clearly bearish. Money flow is weak and the Moving Average Convergence Divergence (MACD) is on a strong sell signal.
So, we could see a move to the 200-day moving average around $52 or so, and then lower targets at $44. Put in a stop at $70 just in case.
Peabody's Chart Is Low Energy
Stocks that cannot rally with the market are doomed to more failure. Such is the case with Peabody Energy BTU, a stock that has been been bouncing around but creating lower highs in the process. That is bearish, of course, and frankly a move below the recent support level should not come as a surprise.
Notice also the big red candles are on heavier volume, which means big institutions are unloading the stock. Not good if you're bullish on coal or Peabody. Money flow is weak, the Relative Strength Index (RSI) is starting to turn lower and the cloud is red.
It all adds up to lower prices ahead, so let's target the $18 level here, although it may take awhile to reach that objective. Put a stop in place at $24 just in case.
Can Boeing Ever Get Flying Again?
Boeing BA is clearly the worst of the worst in the Dow Industrials. So many fits and starts you tend to lose count. Even a recent surge up just under the 200-day moving average was turned away on bigger volume. It seems even buyers from "old" are getting out of the name when they have the chance.
Money flow is still bearish, the cloud is red, MACD is on a sell signal. The chart just looks awful, but is useful to a short seller. Target the $140 area and if that objective is hit then look at $120, which would be an ugly fall. Put a stop in place at $192 just in case.
