What a rebound in the stock market! The PowerShares QQQ ETF (NASDAQ:QQQ) surged 2.6%, the Dow Jones jumped almost 500 points and for once, small caps led the rally rather than the decline. That sets up a ton of must-see stock charts and top stock trades for tomorrow.
Top Must-See Stock Charts #1: Adobe (ADBE)
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After reaffirming its guidance and laying out expectations for strong growth in 2019, shares of Adobe Systems (NASDAQ:ADBE) soared Tuesday. Shares rose 9% and were strong all day, even when investors were unsure of whether to trust the market’s rebound.
Those who bought on the 200-day are both smart and a bit richer today. The stock easily jumped through its 20-day moving average and I’m going to speculate that it’s not the 50-day slowing it down at the moment.
If the market holds up, Adobe should easily hurdle the $260 level. I wouldn’t let shares get below $250 now though if I were long and the ultimate line in the sand is near ~$230. Below that and Adobe is in trouble.
If the broader market plays ball and rallies in Q4, look for new highs in ADBE.
Top Must-See Stock Charts #2: Morgan Stanley (MS)
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Morgan Stanley (NYSE:MS) beat on earnings estimates and saw a 6% rebound as a result. Will shares find resistance at $46?
That much is not yet clear, although the declining 20-day moving average and previous support are at this level. While the bounce off $43 is impressive, I don’t like the setup in MS stock as much as I do others.
For instance, Goldman Sachs (NYSE:GS) and Bank of America (NYSE:BAC) have better setups, while JPMorgan (NYSE:JPM) has a pretty clear-cut layout as well.
Top Must-See Stock Charts #3: Domino’s Pizza (DPZ)
A miss on revenue expectations and comp-store sales knocked Domino’s Pizza (NYSE:DPZ) lower on Tuesday by more than 4.5%. However, this growth stock is now sitting on a solid risk/reward support zone.
With support in this $255 area and the 200-day just below, bulls can go long DPZ and bail should it close below the 200-day moving average.
Keep it simple.
Top Must-See Stock Charts #4: Canopy Growth (CGC)
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Last week, we highlighted just how darn well Canopy Growth Corp (NYSE:CGC) was holding up amid the brutal declines in the stock market.
The stock continues to trade well, although I don’t like to buy big movers into events. On Wednesday, recreational pot will be legalized in Canada. Whether that’s priced in already or provides a big jolt to CGC, I’m not sure.
What I do know is that CGC is holding up above short-term downtrend resistance. If bulls are itching to get into this name, they can do so, so long as CGC is above this mark and the 20-day moving average. I would feel better about it over the $55 to $56 level or on a deep decline down to $36, though.
Top Must-See Stock Charts #5: IBM (IBM)
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International Business Machines (NYSE:IBM) will report earnings after the close on Tuesday. The stock has been dead money for a while now that’s why — along with General Electric (NYSE:GE) and Snap (NYSE:SNAP) — I named it one of the 3 stocks to avoid this summer.
On the charts, we can see IBM consolidating between our two trend lines (blue lines). There’s long-term resistance between $165 and $170 and long-term support between $130 and $135.
I need a break of some sort. Either a breakdown into support, where it holds and doesn’t go below $130 or a breakout over $155. Without either one, IBM can continue to chop around. Over the last few years though, Q4 has been kind to IBM. Let’s see if management can draw a repeat.
Bret Kenwell is the manager and author of Future Blue Chips and is on Twitter @BretKenwell. As of this writing, Bret Kenwell is long BAC and JPM.
