The jobs report came in better than investors had expected, which should be good news, right? Well, it actually is good news, even though the stock market fell for the first few hours of the trading session before erasing a bulk of those losses. Let’s look at a few of the top stock trades that were uncovered in the session.
Top Stock Trades for Tomorrow No. 1: Roku
Roku made a perfect test and reversal off its 50-day moving average (on an analyst downgrade, no less) on Tuesday and is pushing through its 20-day moving average on Friday.
If ROKU can penetrate $100, its $108.32 high is on the table. Its momentum via the MACD measure (blue circle) isn’t in bulls’ favor yet, but could be soon.
Top Stock Trades for Tomorrow No. 2: Electronic Arts
On the plus side, the stock held up at long-term range support near $90. On the downside though, range resistance at $105 is still in place, while EA also fell through its 10-week, 50-week and 200-week moving average during the week.
Until proven wrong, though, bulls can buy on dips down toward $90 and sell on rallies up to $105. A breakout or breakdown from either level would negate that setup.
Top Stock Trades for Tomorrow No. 3: Alphabet
Just a few sessions later, we have the stock pushing through both the 200-day and 50-day moving averages and hitting its highest level since May. Now what?
It’s possible shares go on a run ahead of earnings later this month. But I want to see how GOOGL stock does early next week near this 200-day and 50-day moving average. They are just a few dollars apart and it’s possible GOOGL reverses next week. Should the rally continue, the $1,180 to $1,200 area is on the table. On a pullback, I want to see the ~$1,100 area hold up as support.
Top Stock Trades for Tomorrow No. 4: Zscaler
Click to Enlarge We tried Zscaler (NASDAQ:ZS) on the long side about a month ago, but the stock wasn’t ready to run even though it was flirting with a breakout over $80. Even though the breakout failed, the uptrend held steady (blue line), as ZS continued to put in a series of higher lows.
Then, we had the best price action in ZS on Friday.
After logging its highest closing price on Wednesday — over the $80 breakout level — shares pulled back early on Friday before bouncing off $80 and going on to new highs. It’s very constructive to see former resistance turn into support. I would love to see a continuation higher next week. Otherwise, tests of $80 that hold as support may be solid buying opportunities.