5 Top Stock Trades for Monday Morning

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top stocks - 5 Top Stock Trades for Monday Morning

The jobs report missed economists’ expectations and the stock markets again plunged for most of Friday’s session as bond yields continued higher. Many stocks failed to close on the lows, getting a decent bounce in afternoon trading. Here are our top stocks to trade going into this week, where the focus will be on inflation gauges such as producer, consumer and import prices.

Nvidia (NVDA)

top stock trades for NVDA
Source: Chart courtesy of StockCharts.com

The $266 mark was a great place to take a long position in Nvidia (NASDAQ:NVDA). The stock came down to its 50-day moving average and short-term uptrend. It also filled a recent gap from late-September. For avid users, we flagged this on Twitter when Nvidia was still up at $272.

The market is still a bit dicey, something we said could be the case for Friday considering Thursday’s action and the jobs report. However, we have sold off a lot in just a few days and it wouldn’t be a surprise to see a further bounce early next week.

A close below the 50-day and/or uptrend support could be a reasonable stop-loss for short-term bulls. This setup is ideal for an attractive risk-reward in the short term.

General Electric (GE)

top stock trades for GE
Source: Chart courtesy of StockCharts.com

Oddly enough, one of the most high profile stocks that held up the best on Thursday and Friday was General Electric (NYSE:GE).

Yes, that GE.

Shares used Friday’s selloff as an opportunity to charge higher by 4.5% and burst through the 100-day moving average.

This week of trading is highlighted by the blue circle on the chart. Remember, on Monday GE announced a leadership change with a new CEO. The ensuing two sessions were quite choppy, but GE did a great job by closing above downtrend resistance on the second day. Bulls got a confidence boost on Wednesday and Thursday, by holding onto the gains and even rallying in the face of a stiff decline in the broader markets. Then on Friday, shares surged higher. What great action.

So is the bottom in? Maybe. I’d love a flush-and-hold when GE reports earnings on 10/25. Until then, GE stock needs to stay above prior downtrend resistance.

Visa (V) and MasterCard (MA)

top stock trades for V
Source: Chart courtesy of StockCharts.com

Talk about some strong-trending stocks, with Visa (NYSE:V) above and MasterCard (NYSE:MA) below.

Of course, it’s not guaranteed that V and MA won’t test their 100-day moving averages, but aggressive bulls have been rewarded (for years!) by buying on pullbacks to the 50-day moving average.

top stock trades for MA
Click to Enlarge
Source: Chart courtesy of StockCharts.com

PayPal (PYPL)

top stock trades for PYPL
Source: Chart courtesy of StockCharts.com
Square (NYSE:SQ) has held up miraculously well amid this two-day selloff, but PayPal Holdings (NASDAQ:PYPL) has struggled.

Thankfully it hit its 200-day moving average and found a solid bounce as a result. There’s also decent support between $80 and $82, the top of a prior range for PayPal.

Let’s not forget, PYPL is an excellent story with incredibly strong fundamentals. Losing almost 10% of its value in about a week seems unwarranted. It may struggle with its 50-day and 100-day on the upside, as well as that short-term downtrend (black line), but I wouldn’t be surprised to see PYPL at $100 by January.

Nike (NKE)

top stock trades for NKE
Source: Chart courtesy of StockCharts.com

One stock not setting up as an attractive buy? Nike (NYSE:NKE).

After the company reported earnings in late September, Nike pulled back and didn’t quite make it to the 50-day moving average, a key level of support for the stock. It hit uptrend support and rallied, however, it didn’t make new highs. Instead, it put in a lower high. Lower highs are bad for trending stocks. That proved true even before the rough sessions on Thursday and Friday.

On Wednesday, shares closed below trend but above the 50-day. The last two sessions lost that mark though and unlike the names above — NVDA, PYPL, GE, V, MA — it did not bounce or reclaim any critical levels. It did not show relative strength or give bulls any confidence.

Investors can try a long near the 100-day where NKE could be good for a bounce. If it fails, $76 could be in the cards.

Bret Kenwell is the manager and author of Future Blue Chips and is on Twitter @BretKenwell. As of this writing, Bret Kenwell was long V and NVDA.

Bret Kenwell is the manager and author of Future Blue Chips and is on Twitter @BretKenwell.


Article printed from InvestorPlace Media, https://investorplace.com/2018/10/5-top-stock-trades-for-ge-nke-nvda-v-ma-pypl/.

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