Trade war worries? What trade war worries? After another round of tariffs between the U.S. and China, U.S. equities actually rallied. That’s as investors gain confidence that America has more leverage than previously thought. However, not all of our top stock trades are in the green Tuesday.
Top Stock Trades for Tomorrow #1: Apple
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Apple (NASDAQ:AAPL) hasn’t been trading that well lately, but that’s what happens when a $1 trillion market cap stock gets bid up into a big event. No surprise there.
After a lower high, Apple broke below its 20-day moving average. On Tuesday, it tried to push above but couldn’t hold onto the gains.
It now seems destined for the $210-ish level, where the 50-day and several levels of support will come into play.
Top Stock Trades for Tomorrow #2: Netflix
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We haven’t talked about Netflix (NASDAQ:NFLX) in a while and I’m bummed it didn’t decline to $300, where it would been a great buy.
Interestingly, NFLX stock has put in a series of higher highs (purple arrows) as well as lower lows (blue arrows). This is leading to a showdown and whichever way NFLX breaks, the stock will likely continue.
A close over this $370 to $375 level should get bulls excited. It would be over resistance and it would also end the lower-lows dynamic. Not that NFLX couldn’t go lower down the road, just that the current pattern would be snapped.
Now over all three major moving averages again and NFLX is on watch.
Top Stock Trades for Tomorrow #3: Tesla
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Worries over a DOJ investigation smacked Tesla (NASDAQ:TSLA) lower Tuesday, just as the stock was testing the all-important $300 level.
Tuesday’s lows in the upper-$270s will be important to watch. Not only has the region been decent support so far in 2018, but a break below Tuesday’s levels could signal a test of the monthly lows near $250.
Today’s move also verifies a failure at the 20-day moving average. Holding up over $280 for the rest of the week may give bulls the confidence they need to retest the $300 level.
Top Stock Trades for Tomorrow #4: General Mills
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Overshadowed by the earnings results out of Oracle (NASDAQ:ORCL) and FedEx (NYSE:FDX) — trade setups of which can be found here — General Mills (NYSE:GIS) also reported quarterly results.
After missing on revenue and beating on earnings, shares fell about 7% in Tuesday’s session.
GIS was perfectly rejected at the 200-day moving average and instantly dropped to a trend-line that hasn’t been relevant since July. But who are we to judge.
If this uptrend holds a support, say at $44 currently, bulls can justify a long position. Below it, and the $41 lows are on the table.
Top Stock Trades for Tomorrow #5: Alibaba
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It hasn’t been a smooth decline for Alibaba (NYSE:BABA), which like JD.com (NASDAQ:JD) and other Chinese tech stocks, has been getting crushed over the past few months.
But this is exactly the action we talked about. Earlier this month, we said BABA stock may be worth a shot on the long side on a decline to this $145 to $148 area. Instead it stopped short, bottoming near $153 and rebounding. So we missed it. Our concern though was that prior long-term support would become resistance, and even said bears could give a short position a shot near that area.
Now back at $155, that plan is playing out. Should BABA’s prior lows fail, look for a test below $150.
Bret Kenwell is the manager and author of Future Blue Chips and is on Twitter @BretKenwell. As of this writing, Bret Kenwell did not hold a position in any of the aforementioned securities.
