Tech sold off early as the market came under pressure, but as we got into the afternoon, sellers were unable to keep the pressure up. As such, the bulls were able to rally stocks off the lows and push the major indices back toward breakeven. Let’s look at some top stock trades going into Tuesday.
Top Stock Trades for Tomorrow #1: Citigroup
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Citigroup (NYSE:C) beat on earnings and revenue estimates but shares are only flat as a result. It’s not the post-earnings run we saw in JPMorgan (NYSE:JPM), but not the pullback we’ve seen and are seeing in Wells Fargo (NYSE:WFC) and Goldman Sachs (NYSE:GS).
So what do we make of this? On the daily chart above, shares are over the notable $66 level, but struggling to pierce the stock’s channel resistance (blue line). On the long-term chart below, downtrend resistance (blue line) could cause an issue for bulls too.
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On the plus side though? Shares are holding up near current levels and if buyers grab ahold of C stock, it could create a breakout on multiple timeframes. Below $64 and I would become worried for Citigroup.
Top Stock Trades for Tomorrow #2: Aphria
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Shares of Aphria (NYSE:APHA) were consolidating in a very tight range leading up to Monday’s 14.5% decline after the company missed on earnings and revenue expectations.
Below all of its major moving averages, range support (black line) and wedge support (blue line), and there’s little reason to get behind APHA now as a trade. This name is a no-touch until it becomes more clear where support will step in.
Top Stock Trades for Tomorrow #3: Caesars Entertainment
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Shares of Caesars Entertainment (NASDAQ:CZR) are looking more constructive, as CZR continues to knock on $9.50 resistance.
One could make an argument that CZR stock already broke out over $9 and that’s true. However, I would much rather see it push through $9.50. That way it would be above all major moving averages, as well as several key levels.
Now what? Let’s see if CZR can breakout over $9.50. If it can and if the move sticks, see that $9.50 holds and it can be the new “line in the sand” for bulls. For those long now, below the 50-day and CZR becomes concerning.
Top Stock Trades for Tomorrow #4: Amazon
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What a ripper Amazon (NASDAQ:AMZN) has been, slowly but steadily rallying straight up through Monday’s session. Large cap tech has indeed been impressive in the session. Will that momentum carry forward throughout the week?
After nailing the breakout over $1,700, AMZN successfully held $1,750 as support and is now consolidating in an unusually tight pattern just beneath $1,850. You can see Monday’s rebound in the most recent candle, as AMZN looks like it wants to breakout.
Traders will surely buy the move over $1,850, but the key will be whether it sticks. Keep in mind, AMZN and its peers will report later this month, so a pre-earnings run isn’t out of the question. Conversely, a pullback could make Amazon attractive into earnings.
Let’s see how it handles this level. Above and the breakout is in play. Below Monday’s low and a pullback could be underway.
Top Stock Trades for Tomorrow #5: Alphabet
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Alphabet (NASDAQ:GOOGL, NASDAQ:GOOG) is another mega cap tech stud on Monday.
Uptrend support (blue line) continues to buoy GOOGL stock, while its move over $1,220 (black line) and short-term downtrend resistance (purple line) is significant. It puts the recent highs near $1,240 on the table and even higher prices are possible if it clears that.
A drop below $1,220 puts uptrend support and the 20-day back in play. Keep it simple.
Bret Kenwell is the manager and author of Future Blue Chips and is on Twitter @BretKenwell. As of this writing, Bret Kenwell is long GOOGL and AMZN.
