Stocks are about flat on Thursday, as investors continue to digest the big rally to start the year and this week’s so-far miniature pullback. Let’s look at some top stock trades.
Top Stock Trades for Tomorrow #1: Freeport-McMoRan (FCX)
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Shares of Freeport-McMoRan (NYSE:FCX) aren’t having a very good day, falling about 13% after the company reported disappointing earnings. It came at a terrible time on the charts, too.
The 21-day moving average was just crossing above the 50-day, meaning that short-term momentum was really starting to come back to the bulls’ side. However, the decline thrusts FCX below both moving averages, as well as back below downtrend resistance (blue line).
If short-term uptrend support (black line) can’t support Freeport, the December lows are back on the table.
Top Stock Trades for Tomorrow #2: Bristol-Myers
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Bristol-Myers (NYSE:BMY) reported decent earnings results but shares are down slightly on the day. At this point though, it’s all about the $74 billion merger with Celgene (NASDAQ:CELG).
Bristol-Myers isn’t a bad company and is getting a good price for Celgene, in my view. Since it’s a cash and stock offer, investors can find alpha in CELG provided the deal goes through.
For those in BMY, it’s encouraging to see shares holding up above the 21-day moving average. If they can push through the 50-day moving average, we can get a move up to the 200-day near $54.
Top Stock Trades for Tomorrow #3: Lam Research
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Lam Research (NASDAQ:LRCX) ripped 15% on Thursday after the company beat earnings and revenue expectations. In fact, it helped spark a rally within the semi sector too. Let’s see if Intel (NASDAQ:INTC) can keep the momentum going when it reports after the close.
With LRCX, it’s very encouraging to see the stock surge through downtrend resistance (blue line), but the stock is now coming in $165 resistance and the 200-day moving average.
I would love to see some consolidation below this mark and even a pullback provided Lam stays above prior downtrend resistance. If so, it will setup a breakout over $165. If Intel reports good numbers, perhaps that will be enough for LRCX.
Top Stock Trades for Tomorrow #4: Xilinx
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Another big earnings mover? Xilinx (NASDAQ:XLNX), which is up almost 20% on its strong earnings results and guidance. Unlike most stocks though, XLNX was incredibly strong in the fourth quarter.
Given that, today’s explosive move higher shouldn’t be too surprising. However, it’s too much for me to chase, so perhaps bulls should consider waiting for a pullback.
I like XLNX back near channel resistance (blue line) or on a pullback down to $95. Although I don’t expect the latter to come to fruition, short of a large market correction.
Top Stock Trades for Tomorrow #5: Ford
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Ford (NYSE:F) is up nicely on Thursday, climbing about 3% despite mixed fourth-quarter earnings results. If the 50-day moving average and downtrend resistance hold F stock in check, bulls can consider buying down near $8.20 or so.
It’s encouraging to see Ford stock rallying on what is not exactly great news. That said, the trend is still lower — for now. We need to see Ford break through resistance to become a more convincing buy. Otherwise, it’s hard to buy on the hope of a breakout.
Bret Kenwell is the manager and author of Future Blue Chips and is on Twitter @BretKenwell. As of this writing, Bret Kenwell is long CELG.
