Trade talk between the U.S. and China dominated the headlines Wednesday, with an added kicker of North Korea. It left no shortage of top stock trades to dissect for Thursday.
Top Stock Trades for Tomorrow #1: General Electric (GE)
This is in pretty cut and dry. While General Electric Company (NYSE:GE) didn’t fall 7.5% in response to the U.S. trade situation, it did drop on management’s comments about its power unit. Interestingly, they said Power profit would be flat and reiterated their earnings and cash flow outlook. So it’s unclear why GE’s diving at this point.
However, below trend-line support and $15 was the stopping point for short-term bulls. A secondary break below $14 and the 50-day moving average would be bad news.
Top Stock Trades for Tomorrow #2: Target (TGT)
Target Corporation (NYSE:TGT) puked more than 5% Wednesday after the company reported its first-quarter earnings results.
Remember to KISS — Keep It Simple, Stupid. TGT stock couldn’t be any more black-and-white.
$68 is support and $77 is resistance. Now at $71, TGT stock is hovering around in no man’s land. If it can get back above its 100-day moving average, bulls could build some momentum. But I don’t want to buy unless it’s a breakout over resistance or a retest of support.
Bears can do the opposite — sell into resistance or on a break of support — for a solid risk/reward trade.
Resistance is now near $66 and gently sloping lower, while support is standing tough at $58. Below both its 50-day and 100-day moving averages though and bulls have to be careful.
One low-risk trade consideration would be to buy the stock on a retest of $58 support. If it fails, buyers can bail with minimal losses. On a break of support, bears can consider going short and look to ride KSS into the low $50s.
Top Stock Trades for Tomorrow #4: McDonald’s (MCD)
Solely from a trading perspective, there’s two ways to play McDonald’s Corporation (NYSE:MCD) right here: conservatively or aggressively.
The aggressive bull will buy near current levels, as a potential short-term trend line has formed (blue line). However, conservative buyers will wait for a possible pullback to ~$155, a level of support that has held for most of 2018.
I’d rather miss out on the upside and wait for a better entry myself (i.e. play the conservative strategy). Either way, MCD has a lot of moving averages to push through, but a break over $164 should kickstart even more upside for the fast-food king.
Top Stock Trades for Tomorrow #5: Chesapeake (CHK)
That spark has fueled the run from sub-$3 to a quick touch of $5 inside of a few weeks. It also pushed CHK through all three major moving averages and above major downward resistance. Getting above that downward resistance was an important feat. I would expect CHK stock to cool off a bit and at this point it’s anyone’s guess whether $4.25 (blue line) will hold as support.
But so long as it doesn’t fall back below — call it $3.50 — bulls have the momentum for now. Let’s look to see where this finds support after it consolidates a bit.