BearishBusinessstocks

Bearish Bets: 2 Stocks You Really Should Consider Shorting This Week

These recently downgraded names are displaying both quantitative and technical deterioration.


Stocks quotes in this article:

NUS,

ADUS

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.

Nu Skin Enterprises

Nu Skin Enterprises Inc.  (NUS)  recently was downgraded to Hold with a C+ rating by TheStreet’s Quant Ratings.

7b82822f 2f37 11ec 9da9 1525f0d14f16

The maker of personal care and wellness products is stuck in a miserable downtrend. It might be over, but notice the poor money flow and the tepid response to the Relative Strength Index (RSI) bottoming.

Could this stock bounce around the bottom for a bit? Sure it can, but the trend is down and we follow trends. The stock is well under all the moving averages, so there is resistance on any move back up.

Any rally here could be a good short opportunity; target the low $30s but put in a stop at $48 just in case.

Addus HomeCare

Addus HomeCare Corp. (ADUS)  recently was downgraded to Hold with a C+ rating by TheStreet’s Quant Ratings.

95f327a0 2f37 11ec 9da9 21efe512d844

This provider of home care services started rolling over in early September with some poor price action, but the high turnover started a month earlier. Money flow is bearish, we have a Moving Average Convergence Divergence (MACD) sell signal to work from and the stock is well under all the moving averages.

When the stock market is acting poorly and other names are worse, we say these names have poor relative strength. That can be seen in the top pane (RSI). These are often good stocks to short toward lower prices.

Put in a stop at $81, but let’s target the mid-$60s here.

This commentary is an excerpt from “5 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.

Get an email alert each time I write an article for Real Money. Click the “+Follow” next to my byline to this article.

More from Stocks

How to Plan a Trade

Do you formulate a strategy when you enter a trade, or do you just hope for good luck?

Real Money’s message boards are strictly for the open exchange of investment ideas among registered users. Any discussions or subjects off that topic or that do not promote this goal will be removed at the discretion of the site’s moderators. Abusive, insensitive or threatening comments will not be tolerated and will be deleted. Thank you for your cooperation.
If you have questions, please contact us here.

Email sent

Thank you, your email to has been sent successfully.

Oops!

We’re sorry. There was a problem trying to send your email to .


Please contact customer support to let us know.

Please Join or Log In to Email Our Authors.

Email Real Money’s Wall Street Pros for further analysis and insight

Already a Subscriber? Login

Related Articles

Leave a Reply

Your email address will not be published. Required fields are marked *

Back to top button
Close
Close