Without any significant trade threats being tossed around on Tuesday, U.S. stocks were able to build on their meager morning bounce, putting together a decent day on Wall Street. Some others made notable moves too, inspiring our top stock trades for Wednesday.
Top Stock Trades for Tomorrow #1: General Electric (GE)
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General Electric Co (NYSE:GE) made waves by announcing a restructuring and really showing an effort that it’s doing all that it can to get back to its glory days.
GE stock surged more than 8% on the day, leaving some to wonder if the worst is over. That may not be the case, but the market is all about perception and if the perception of GE 12 to 18 months out has improved, it’s stock could be okay from here.
A look at the charts shows a clean double bottom forming, a bullish trading pattern. However, how GE handles $14 will be key. Not only did this level go from support to resistance in 2018, but GE’s 50-day and 100-day moving averages are within 20 cents of each other and sit just below $14.
If GE can get above $14, it may have three significant levels of support below it. That would bode well for bulls.
Top Stock Trades for Tomorrow #2: Adobe (ADBE)
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Adobe Systems Incorporated (NASDAQ:ADBE) has been a total monster over the past year and what do we do with monsters? We buy them on the dip!
We flagged this one earlier this month, saying to be ready to pounce on ADBE if it tags its 50-day moving average. It did on Monday and again on Tuesday. Just like Salesforce.com, inc. (NASDAQ:CRM), we have to play these trends until they fail.
Although there’s a trend-line on the chart, it’s not really necessary as the 50-day moving average acts as an accurate proxy. $20 off its highs after a strong earnings report makes it even more attractive. For now, we’re buyers until this trend fails.
Top Stock Trades for Tomorrow #3: Alphabet (GOOGL)
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FANG stocks — Facebook Inc (NASDAQ:FB), Amazon.com, Inc. (NASDAQ:AMZN), Netflix, Inc. (NASDAQ:NFLX) and Alphabet Inc (NASDAQ:GOOG, NASDAQ:GOOGL) — all made new all-time highs last week and all were smashed on Monday.
Google stock is an interesting one though. On the one hand, it found support right where it needed to, on the backside of trend-line support (black line).
It was good to see it hold this mark. It makes retesting its highs that much easier going forward. That said, it has an ominous looking double-top right now. If GOOGL stock can hold up and if the markets don’t get too bearish, we could see this name move higher this summer.
Top Stock Trades for Tomorrow #4: Digital Realty (DLR)
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On Monday we pointed out how well REIT stocks have been trading by highlighting Ventas, Inc. (NYSE:VTR). We didn’t want to make it all about REITs, so I am spreading a few of these names out over a few days.
Digital Realty Trust (NYSE:DLR) fits the strong trend too. This sector is not only surviving, but it’s now thriving despite the Fed’s latest decision to raise interest rates. While not out of the woods technically, it does suggest that perhaps the worst is over in terms of the selloff.
DLR and VTR are two of my favorite REITs, along with Realty Income Corp (NYSE:O). Now bursting through resistance with a solid trend just below, DLR looks good and yields almost 4%.
Top Stock Trades for Tomorrow #5: BlackBerry (BB)
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BlackBerry Ltd (NYSE:BB) stock plunged on earnings last week and continued to fall this week.
The $10 to $10.25 area is critical to BB’s stock price. Shares initially continued to tank on Tuesday, falling below $9.75. However, BB staged a sudden reversal and is now up over $10. That’s bullish price action, even if the last few days have been rough. It’s still early, but it could be a sign that a temporary bottom is in.
Investors taking a long position now would be wise to consider using a stop-loss on a break of Tuesday’s lows. That allows bulls to play for a possible bounce without taking on too much risk.
Bret Kenwell is the manager and author of Future Blue Chips and is on Twitter @BretKenwell. As of this writing, Bret Kenwell was long CRM and ADBE.
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