Another big rally on Wall Street is giving bulls some confidence. That said, here’s a few top stock trades to consider now.
Top Stock Trades for Tomorrow No. 1: Apple (AAPL)
Apple (NASDAQ:AAPL) may have gained just a few percent on Wednesday, but it’s up dramatically from this week’s low. On Monday, the stock hit the exact breakout level from September, at $215.
You remember this level. Apple topped out here twice, once in May and once in July despite strong earnings results. In September, AAPL finally broke out over this mark, then held it with an impressive reversal in October (purple arrow).
I called for a pullback in Apple once it was clear that momentum had waned. However, I never thought we’d see $215.
Now up $40 from that mark, Apple has reclaimed the 200-day moving average and the $248 level. It’s also broken out over steep downtrend resistance (blue line). I want to see the stock hold up above these marks now. A move back below $240 puts a gap-fill down toward the $220s in play.
On the upside, a rally back to the 100-day moving average seems greedy — but it’s technically possible. At this stage, though, I’d be cautious. It’s still a bear market after all.
Top Stock Trades for Tomorrow No. 2: Nike (NKE)
Nike (NYSE:NKE) shares are bursting higher on Wednesday after better-than-expected earnings.
The rally has been powerful, as Nike stock reclaims the 200-week moving average.
After two weeks, the stock has successfully closed both weeks north of $65, while tests down to $60 held as support as well.
Now let’s see if Nike can reclaim the 100-week moving average near $83. So far, this mark has been resistance. Over it puts the 50-week moving average on the table. On a move lower, though, see if NKE can hold the 38.2% retracement. Below puts the 200-week moving average back on the table.
Top Stock Trades for Tomorrow No. 3: S&P 500 ETF (SPY)
The SPDR S&P 500 ETF (NYSEARCA:SPY) is looking to complete its first two-day gain in more than a month. The ETF is also pushing over downtrend resistance (blue line) mark that’s beaten it down for weeks now.
This $255 level could be critical for SPY, putting $270 on the table if it’s able to clear it with conviction. Below it keeps a retest of the lows from the fourth-quarter of 2018 on the table near $233.
Below that puts the 52-week lows on the table.
I’m not trying to be a pessimist here, but remember, we are in a bear market at the moment. Up big from the lows, and it’s hard to add aggressively to longs until we get some better news and more technical confirmation.
A decline that results in a lower high will give bulls another chance to load up and the charts more time to repair. A surge forces investors to chase longs and ultimately puts another steep decline in play.
Top Stock Trades for Tomorrow No. 4: Boeing (BA)
Boeing (NYSE:BA) shares finally popped higher, as the stimulus bill looks to wrap up soon. Shares were able to reclaim the $137 level, but are running into the 23.6% retracement for the 52-week range.
On a pullback, see if BA stock can hold $137 as support. Below keeps $100 on the table. Above the 23.6% retracement — however — puts $200, then $220-plus on the table. Take it level by level and if you bought sub-$100 for a trade, booking some profits would be a prudent consideration.
Bret Kenwell is the manager and author of Future Blue Chips and is on Twitter @BretKenwell. As of this writing, he is long AAPL.