Microsoft (MSFT) is trading up 10% today after reporting better than expected earnings last night. For a blue chip like Mr. Softy, moves like this are extremely uncommon, and it has pushed the stock more than 3.5 standard deviations above its 50-day moving average. When a stock is this overbought, we recommend avoiding getting long until it moves back down into its trading range. If you already own the name and have been looking for an exit point, extreme overbought readings provide a good opportunity to lighten up as well.
The opposite is also the case. When a stock that is uptrending moves down into extreme oversold territory, it provides an attractive entry point if you’re looking to own the name long-term.
In today’s Idea Generator report available to Bespoke Institutional members, we provide a list of the most overbought and oversold names in the Russell 1,000. If you’re currently in search mode for new portfolio holdings, or you just want to see stocks that are at their historical extremes, today’s report is a great starting point.
Our Idea Generator goes out to Bespoke Institutional members every other trading day, and each report provides a different screen based on various fundamental, technical or sentiment measures. For fundamentals, we highlight stocks that are the most over and under valued. For sentiment readings, we look at things like short interest levels and volume. And for technicals, along with overbought/oversold levels, we highlight stocks trading at 52-week highs and lows, stocks that are consistently closing at their highs or lows for the day, and stocks that are the most volatile. It’s an excellent report if you’re looking to generate new stock ideas. That’s why it’s named the Idea Generator of course!
Start a free Bespoke Institutional trial below to see today’s Idea Generator and everything else that’s included with our top level of service. If you apply the coupon code “IDEAS” at checkout, you’ll get $50 off your first payment!