Technical Watchlist: Myriad Genetics, Limoneira, Shutterstock

It’s always fun to keep some fast-moving stocks on your watchlist if for nothing else you can see how they behave under certain technical conditions. For example, we covered FATE in a technical watchlist article last month and shares have jumped 50% since. Here are three such stocks that have shown that they’re capable of moving just as fast, in either direction and are likely to be doing so in the near future.

Myriad Genetics (NASDAQ: MYGN)

Shares of Myriad Genetics (NASDAQ: MYGN) have been flying around this year and investors have been kept on the edge of their seats. Bullish news along the lines of fresh insurance coverage on their drugs have resulted in 50% moves overnight while bearish news concerning the company’s earnings has brought the stock down just as much, just as quickly. Several times this year a harsh gap down has been followed by steady, grinding recovery and that’s where shares find themselves today.

The $2 billion molecular diagnostics company reported ugly FQ1 numbers in early December and the stock dropped 40% on the next day’s open. It had been steadily recovering ground lost after August’s earnings release, which was also ugly, caused a 35% gap down. The stock had rallied a full 60% since between the two earning dates and looks to be trying to do the same again this time. Shares are up 30% since November’s dip and momentum is clearly with them.

It’s this momentum that is carrying them into a showdown with a downtrend in a tightening pennant. A break to the upside sets them up to continue filling in the November gap. Investors will be hoping that the company has set realistic expectations on Wall Street and that February’s earnings report bucks the trend of ugly surprises.

In the meantime, like many biotechs, they attract the dreamers and while reality can sometimes bite, that doesn’t stop hope from continuously bidding the stock higher.

Limoneira (NASDAQ: LMNR)

The longer shares bounce along in a sideways action without breaking down, the more likely they are to start testing the upside and that’s exactly where Limoneira (NASDAQ: LMNR) stock finds itself. Shares are down about 45% from 2018’s highs but have been forming a solid base along the $18 level which has been a historic level of support. Having bounced along there since May, it looks like they’re getting ready for a move to the upside and have started making higher highs - a sure sign of building momentum.

The natural destination would be the $25 mark which is where they’ve been pushed back from several times in the past.

After a stunning 60% run last year, shares of the lemon producer giant were brought back to earth after a bad earnings miss that was largely driven by surprisingly bad weather. While by nature it’s vulnerable to risks like this, that doesn’t mean its stock can’t present technically based opportunities in the short term.

Shares are right around the 50-day moving average and a stop at $18 provides decent downside protection. Look for a continued move higher into the $20s and if the fundamental factors support expectations, a move back towards all-time highs.

Shutterstock (NYSE: SSTK)

Looking at the weekly chart of Shutterstock (NYSE: SSTK) shares makes it seem as if they’ve been marching towards this showdown since they IPO’d in 2012. The stock photography provider’s stock has been setting higher highs and lower lows in the 7 years since and that can only mean one thing; the mother and father of all tightening pennants and a date with destiny in the near future as the bulls and bears will be forced to meet.

Both have had their heyday with the stock. The former scored first blood with a 350% run out the gates following the IPO. Since then though they’ve fought a losing retreat to the latter, who have continuously pushed back any attempt to reclaim 2013’s heights.

Internally, growth has slowed and the company’s November earnings release painted a picture of a company that’s stalling on all fronts. Despite EPS beating expectations, growth across revenue, sales, and paid downloads were basically flat. So while you mightn’t be putting your kids’ college funds into the stock, it’s still worth having up on a watchlist to see how it behaves in the coming weeks.

The trading range will likely start narrowing and narrowing fast, staying in the high $30s until a move is forced one way or the other. Investors might consider some long option strategies here like a straddle which can benefit if the stock simply makes a strong move in either direction.