It looked like it was going to be a rough day for investors, but Monday’s action proved otherwise. While Friday was a painful day for bulls and with futures pointing to more losses on Sunday night, all it took were some positive trade-related headlines to turn things around. After Monday’s rally, let’s look at a few top stock trades.
Top Stock Trades for Tomorrow #1: Netflix
Netflix (NASDAQ:NFLX) continues to struggle, locked in a tough downtrend that’s pressured the stock to new recent lows for 2019.
A name that would normally rally from lower interest rates, NFLX stock continues to struggle as its quarterly results haven’t been impressive enough and as streaming competition increases.
We flagged the test of prior range support near $340 and subsequent pullback since. Still below downtrend resistance (blue line), investors need to see NFLX hurdle this level, as well as the 20-day moving average. Over the latter and a run to the 50-day could be in the cards.
Should it lose the $288 mark, a decline to $270 could be in the cards.
Top Stock Trades for Tomorrow #2: Amgen
Amgen (NASDAQ:AMGN) caught a 2.5% boost on Monday after it was announced that it will buy Otezla from Celgene (NASDAQ:CELG) for $13.4 billion. The former gets a solid asset while the latter gets a good price and likely takes a step toward FTC approval to be acquired by Bristol-Myers Squibb (NYSE:BMY).
AMGN has a nice-looking bull pennant forming over the past few weeks. Shares continue to bump up against $205 resistance, while uptrend support (purple lines) keep squeezing shares higher.
A break over resistance could send AMGN higher, with the first target being the $210.41 highs. Above that, and a test of channel resistance (blue line) is technically possible.
Top Stock Trades for Tomorrow #3: Bristol-Myers Squibb
Speaking of Bristol-Myers, it too has been trading well. After bottoming near $42.50 about a month ago, shares have been in a steady climb higher.
While BMY was rejected from channel resistance on Monday, investors are hoping support can buoy the name. Above the 200-day moving average, and the stock still looks good on the long side. Below and a test of the 20-day moving average, as well as channel support, is on the table.
Top Stock Trades for Tomorrow #4: Aurora Cannabis
Pot stocks remain pressured, and Aurora Cannabis (NYSE:ACB) is lodged in a brutal downtrend. Once $7 gave way, the stock has really struggled to come up for air.
While ACB made new 2019 lows on Monday, shares did reverse higher and turn positive. That’s a good sign for bulls, although it doesn’t mean the stock has found a bottom.
Bulls’ first assignment is to get the stock back above $6. If they can, over current downtrend resistance is the next task. That will put the 50-day moving average on the table, in that event.
On the downside, watch Monday’s lows. Should they give way, it could usher in a flush down to $5.50 and $5, respectively. Look for channel support to continue buoying the name.
Top Stock Trades for Tomorrow #5: Foot Locker
It was a tough day in the markets on Friday, but Foot Locker (NYSE:FL) was under extra pressure after reporting earnings.
Shares are putting together a nice reversal rally on Monday. If it can maintain some of that momentum, it has a chance to retest downtrend resistance (blue line). Above resistance and the 10-week moving average, and a test of $42.50 is possible.
Below Monday’s open and Friday’s close though puts this week’s low on the table. If it doesn’t hold FL up, a test of $30 is possible.
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.
