Optimism around the Federal Reserve’s balance sheet and solid earnings results are encouraging the bulls to make another push higher in the market. The Russell and the Nasdaq are leading the way, while the S&P 500 and Dow Jones are both up about 1%. With that in mind, let’s look at a few notable top stock trades for Monday.
Top Stock Trades for Monday #1: Intel
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Shares of Intel (NASDAQ:INTC) are under pressure Friday, falling 5% after the company beat on earnings estimates but missed on revenue expectations. Further, the company did not name a new permanent CEO.
We were looking for a breakout in Intel over $50, but it was predicated on solid earnings results from the company. That said, Intel is trying to rally off its lows and bulls are doing a good job at keeping the stock from sinking into the weekend.
Now what? We need to see bulls continue that momentum and rally Intel back over the 50-day moving average. If they can’t, look for a retest of uptrend support (black line) if Intel stock takes out its lows from Friday.
Top Stock Trades for Monday #2: Nvidia
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Nvidia (NASDAQ:NVDA) was down early in sympathy to Intel’s earnings, but is now rallying on the day. The stock is coiling tightly between $150 and $160 and trending higher. Shares are also above the 50-day moving average.
It was a disastrous fourth quarter for Nvidia but shares continue to chop higher. If we can get a breakout over $160, look to see if we can get a run up to that $175-ish area, which proved pivotal as support before its November earnings report — as well as after earnings, serving as resistance.
Top Stock Trades for Monday #3: Starbucks
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Unlike Nvidia, the fourth quarter was kind to Starbucks (NASDAQ:SBUX), as it was one of the best-performing stocks in the last three months of 2018. Shares sold off into the close on Thursday on worries over its earnings.
Shares are now up a modest 3% after the company beat on earnings and revenue expectations, as well as raised its full-year outlook. I wouldn’t be surprised if we see SBUX stock run up to resistance, for traders that are looking for some short-term gains.
That said, $68 could again act as resistance. If so, let’s wait for this buy-on-dips name to reset before retesting this area. If it breaks out though, look for a run through $70.
Top Stock Trades for Tomorrow #4: Western Digital
The semiconductor and memory industries continue to run, this time with Western Digital (NASDAQ:WDC) now up 4%. This one is tricky, as shares are well off the highs near $48, but WDC is still positive despite missing both earnings and revenue expectations.
Here’s what we have.
WDC stock has been under tremendous pressure since March, falling 65% from peak to trough. However, shares are putting in some higher lows and now have an uptrend support level (black line) to measure against. It’s also over one downtrend resistance mark as well as the 50-day moving average.
Investors who want to go long here need to see WDC hold up over the 50-day now. Below and a retest of uptrend support is in the cards. Given this nasty downtrend, I wouldn’t say WDC is a buy-on-dips name. But if the 50-day and backside of prior downtrend resistance holds up, perhaps WDC can run up to $46 to $48 once again.
Top Stock Trades for Tomorrow #5: PG&E
PG&E (NYSE:PCG) has been as volatile as ever, as bankruptcy news continues to circulate around Wall Street. With this one, charting is basically irrelevant, as headlines — not technicals — are driving this stock price.
But let’s keep it simple: Avoid PG&E. We saw with last week’s action that bulls can be crushed and with this week’s action the bears were crushed. No one is a winner trying to trade this.
Bret Kenwell is the manager and author of Future Blue Chips and is on Twitter @BretKenwell. As of this writing, Bret Kenwell is long NVDA
