The stock market is still trying to digest comments from Federal Reserve chairman Jerome Powell on Wednesday. The market came into the Fed announcement near its highs, so this type of reaction shouldn’t be all that surprising. Traders are looking to see if the market stabilizes in the short term or if a larger pullback is still needed. Let’s look at some top stock trades going forward.
Top Stock Trades for Tomorrow #1: Qualcomm
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The Fed day reaction gives investors an added obstacle to maneuver. So far, the indices have shown the potential to breakdown, but the bulls have withstood early assaults by the sellers. The question is whether that action continues or if longs wave the white flag for a bit.
If they do, that could create big moves for individual stocks and make life harder in these names. Stay disciplined and nimble when moving forward, for which Qualcomm (NASDAQ:QCOM) is an excellent example. Shares raced up to $90 in Thursday’s session after reporting earnings, but the pullback in the indices have knocked it down.
If QCOM can regain its footing at prior uptrend resistance near $82 to $83, bulls may look at it as a buy-the-dip opportunity. Should the markets embark on a larger pullback, we may see Qualcomm stock down near $75. If so, see how it handles this level and consider it a possible buying opportunity.
Top Stock Trades for Tomorrow #2: Fitbit
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Fitbit (NYSE:FIT) is under pressure Thursday despite beating on earnings and revenue expectations.
After breaking its 50-week moving average and taking out last month’s lows, FIT stock has been in full blown selloff mode. Shares are now locked in a downtrend channel and it’s hard to know where exactly support will come into play.
Since 2018, the $4.80 level has seemed to draw in buyers, while the stock is bouncing off $5 now. See where FIT ends the week. Short-term bulls may be able to use this week’s low to determine a reasonable stop-loss on a speculative long position.
I personally would rather wait for higher-quality setups in higher-quality stocks than take a position in FIT right now.
Top Stock Trades for Tomorrow #3: Alteryx
This one has been a total monster, which is one reason we have Alteryx (NASDAQ:AYX) on our top mid-cap growth stocks list.
Shares raced higher on Thursday following strong earnings, but are currently off those highs as volatility picks up in the broader markets. The stock — rather conveniently — found sellers up near channel resistance and we’ll have to see where it goes now.
I would like to see $90 hold as support on the downside and for AYX to retest its new highs. A push to $100 isn’t out of the picture.
On a pullback below $90, AYX has uptrend support near $83 and the 20-day moving average at $85. Just below at $80 is notable support and the 50-day moving average. I’d be lying if I said a pullback to this area wasn’t attractive.
Top Stock Trades for Tomorrow #4: Advanced Micro Devices
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After opening near $29, Advanced Micro Devices (NASDAQ:AMD) found sellers on Wednesday in its post-earnings trading session. However, shares are rebounding on Thursday, up more than 5% at the moment.
I would love to see AMD stock take out $29 and push into the $30s. Below Thursday’s low increases the odds of testing the 50-day moving average, but right now, AMD is looking attractive. Watch for a possible breakout over $29 in the next few sessions.
Top Stock Trades for Tomorrow #5: Microsoft
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After gapping higher on earnings last week, Microsoft (NASDAQ:MSFT) is finally pulling back. The stock filled that gap on Thursday and aggressive bulls will want to buy this dip.
They can use a close below the 20-day moving average and uptrend support as their stop-loss. Below this level and $120 is in the cards. Conservative bulls and/or longer term investors may consider buying at either of these levels, (the 20-day or $120).
A rebound from current levels should return MSFT stock back to $130+ provided that the overall market doesn’t tank.
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.
