Investors were on edge Thursday, given the sudden pickup in volatility on Wednesday. Let’s look at a few top stock trades that were grabbing the headlines today.
Top Stock Trades for Tomorrow No. 1: Sonos (SONO)
Sonos (NASDAQ:SONO) stock is up marginally after reporting earnings, as shares look to continue higher.
There’s a solid setup in Sonos, with $15 resistance weighing on the stock. Over $15 — which is also the IPO price — could send the stock to new 2019 highs.
From September through November, $15 to $15.25 has been acting as resistance. If bulls can clear this area, it will trigger a breakout. On a pullback, see that the 50-day moving average supports the stock, just as it did on Thursday’s post-earnings reaction.
Falling below the 50-day moving average puts $13 and the 100-day moving average on watch.
No. 2: Ulta Beauty (ULTA)
After a hearty bounce in September, Ulta Beauty (NASDAQ:ULTA) is back to being under pressure. In fact, the stock is just a few dollars above its 52-week low.
The setup does not look encouraging for longs, but those who are bullish on Ulta can dip their toe in this one with a stop just below the 52-week low. On a rally, see if Ulta can reclaim the 50-day. Keep in mind, though, that rallies north of $240 have been sold over the last few months.
Top Stock Trades for Tomorrow No. 3: Aurora Cannabis (ACB)
Are cannabis stocks back from the dead? Maybe so, and that’s got Aurora Cannabis (NYSE:ACB) moving nicely. Not long ago, ACB sold for more than $8 per share; two days ago it was below $2.50.
To say it has been a volatile ride would be an understatement. It’s exactly why we warned investors to get out of the way in the summer, when shares were significantly higher than current levels.
Now, ACB stock is trying to reclaim the $3 level — and struggling. The 20-day moving average is acting as resistance. If shares clear this level, see how ACB handles the $3.50 mark. That was vital support before the most recent breakdown.
No matter how this pans out for Aurora, though, it’s vital for bulls that it doesn’t go on to make new lows.
Top Stock Trades for Tomorrow No. 4: L Brands (LB)
L Brands (NYSE:LB) is following after a number of its retail peers, with a volatile post-earnings reaction. However, unlike many of its peers, shares are actually rallying after the results, up almost 10%.
The setup becomes rather straightforward from here.
Above $15.50 and LB is okay on the long side. Below and it’s a no-touch. Over the 50-day puts $18 on the table and above that, $19.25 is possible. Keep it simple and go from level to level.
No. 5: Jack in the Box (JACK)
Shares of Jack in the Box (NASDAQ:JACK) are off slightly after reporting earnings, but man did the stock put in a wide trading range today!
After opening near its 50-day moving average, shares ran to $90. Then, the stock took a tumble, falling to $80 and is now trying to hold its 200-day moving average. Talk about a series of events.
In any regard, this one is too volatile for me. Below Thursday’s low and JACK can technically fill the gap (blue box) down to $74.
If it can move over the 50-day moving average, the Thursday high near $90 is possible. Above that mark and the $93 highs are possible.
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.