Many stocks have been hit after four days of losses. So, how do we identify the best candidates for potential mean moves? Literally, we need a structured approach. Using the Finviz.com database, we start with 5,506 common stocks (excluding ETFs). To perfect the list: Filter stocks at least 500,000 average daily quantity, priced at $10 or higher, narrow it down to 1,649. View only oversold stocks (RSI below 30) lowers it further to 151. To focus on the uptrend, we can filter stock trading with over 200-DMA to bring the number down to 35… Of these 35, only eight are S&P 500 members: TSLA, SYF, APO, RJF, AXON, PNR, GDDY, now three of them are in NDX: TSLA, Axon & MSTR, which means only two are in SPX&NDX: TSLA and Axon. Axon (Axon) responded well to Wednesday’s earnings, with its previous sell-off creating an extreme oversell that traders have so far earnestly bought. Tesla’s 11-week change rate is now -30%, and the decline looks worse when it breaks down in the intraday data. This severe decline occurred only seven times in its history (excluding overlapping instances). It is worth noting that one of all events (fall 2022) has resulted in strong rebounds and/or major trading lows. While this decline is particularly worrying, as it has happened immediately after TSLA tear to a new high, history shows that it is not unprecedented. After the highs in 2016, 2019 and 2021, the stock encountered a similar sharp pullback, only regrouping and eventually increasing. Tesla now charts the key question: Can history repeat itself, or is it different this time? When stocking craters, sales pressures often become ruthless, and TSLA is no exception. Now, the stock has fallen back 50% of the entire 2023-2025 in less than three months. Apart from the importance of this level, TSLA is now sitting near the resistors before the summer of 2023, a potential technical pivot area. Whether the area is a stable point or just stops in sales, it is clearly an important place for the stock given the magnitude and speed of this withdrawal. Of the other seven S&P 500 shares identified by our screen, Pentair (PNR) stands out. The stock sat just on its 200-day moving average until the end of Tuesday. The stock has tested the 200-DMA twice (October 2023 and June 2024) since retrieving long-term support in early 2023, using it as a reversal of higher launch pads, ultimately leading to new highs point. Additionally, PNR’s 14-day RSI has just reached its lowest level since the summer of 2022, highlighting the stock’s short-term oversold. If this mode plays like in the past, the rebound may soon be achieved, with a high-speed target near its previous high point of about $110. This illustrates how we narrow down a large number of potential trade ideas to a minority with higher beliefs. Of course, countless other factors can be incorporated into the process, and what factors are used depends on personal preferences and understanding of the current trading environment. When the market starts to stabilize again, we will shift the focus to bullish chart patterns that have been effective over the past two years. However, history shows that these settings are most effective only after the S&P 500 rebounds after the S&P 500 rises from volatility. Disclosure: (None) All opinions expressed by CNBC Pro Contributors are simply their opinions and do not reflect opinions from CNBC, NBC Universal, their parent company or affiliate and may have previously been on TV, radio, internet or internet or on the internet or another medium. The above is subject to our terms, conditions and privacy policies. This content is for informational purposes only and does not constitute financial, investment, taxation or legal advice or advice on purchasing any guarantee or other financial assets. The content is general in nature and does not reflect any individual’s unique personal situation. The above may not be suitable for your specific situation. You should strongly consider seeking advice from your own financial or investment advisor before making any financial decisions. Click here for the full disclaimer.
Analyze the stocks that have been broken down this month. Tesla faces a moment of destruction | Real Time Headlines
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