Bearish bets: 3 stocks you should consider shorting this week

Each week, we identify names that look bearish and could present interesting short-term investment opportunities.

Use technical analysis of those stocks’ charts and, where appropriate, recent actions and scores from TheStreet’s Quantity RatingWe fill in three names.

While we won’t be focusing on fundamental analysis, we hope this article gives investors interested in stocks that are on the decline a good starting point to do their homework on. Name.

Ciena struggles

Ciena Corp. (CIEN) was recently downgraded to Organization with a C rating by TheStreet’s Quantity Rating.

The provider of hardware, software and networking services for these communications networks has been on the rocks for the past few weeks after poor earnings and a flurry of sales. Note the Relative Strength Index (RSI) dropped from 70 to 30 in the blink of an eye. That caused trouble, but the oversold bounce was due.

The Moving Average Convergence Divergence (MACD) is giving a sell signal and the cloud is once again turning red. Money flow is decreasing, so let’s put short at current level; target $30 low but stop at $50.

The morning star does not shine

Morningstar Inc. (MORNING) was recently downgraded to Organization with a C+ rating by TheStreet’s Quantity Rating.

The independent investment research provider has struggled with higher end-of-day selling volumes. The money flow has narrowed significantly and a downtrend channel has been formed. We could see a hold around $220 or so, but that will be demanding.

MACD is giving a sell signal here so place a sell order here and target $200. Place a stop at $255 just in case.

Open Keeps document Close

Open Text Corp. (OTEX) was recently downgraded to Organization with a C+ rating by TheStreet’s Quantity Rating.

Recently, the information management software vendor has declined and is a downward spiral. You might think there’s nothing left to go on about the downside, but there’s certainly still some meat on the bones.

The money flow is falling sharply and the RSI is falling with almost washed out levels. That is not a buy signal. There are very strong volume trends and they are bearish of course, with a heavy distribution from the recent gap downwards. Start a small short here and add more to a higher one. Target $20 area, place stop at $34.

(Real Money Contributor Bob Lang is co-manager of TheStreet’s portfolio.) Action Alert PLUS. Want to be warned before AAP buys or sells stocks? Learn more now.)

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