U.S. stocks again pushed to new highs on Wednesday, as equities continue to race higher despite coronavirus worries. That said, let’s look at a few top stock trades for Thursday.
Top Stock Trades for Tomorrow No. 1: Micron (MU)
One of investors’ favorite chip stocks continues to plow higher. As Micron (NASDAQ:MU) stock climbs, it’s now hitting new 52-week highs. The only thing left? Taking out its highs from 2018.
Shares are coming into a tough resistance zone near $61, but over that mark puts the March 2018 high of $63.42 and the May 2018 high of $64.66 on the table. Over those marks, and MU stock may continue to gain momentum.
On a pullback, bulls will want to see the 10-week moving average hold as support. Below that puts the $52.50 level on watch. A further drop, and the 50-week moving average and uptrend support (blue line) will be on the table.
Top Stock Trades for Tomorrow No. 2: Lyft (LYFT)
After Uber (NYSE:UBER) ripped higher on better-than-expected results last week, Lyft (NASDAQ:LYFT) just couldn’t deliver. That’s too bad, as bulls were bidding shares higher in hopes of an inspiring quarter.
Now, the stock is below the key $50 level, as well as the newly established 200-day moving average. If Lyft can reclaim these two marks, it puts the pre-earnings high on the table.
On the downside, bulls would like to see the 50-day moving average currently near $47 hold as support. However, the must-hold mark is the 100-day moving average and uptrend support (blue line) near $45. Below puts the 2020 lows on the table around $42.50.
Top Stock Trades for Tomorrow No. 3: Shopify (SHOP)
Man, Shopify (NYSE:SHOP) continues to blow the roof off, with its latest earnings report propelling the stock to nearly $600 earlier! However, the stock is being met with sellers. What gives?
I would guess it’s a few things. First, the valuation here is very high, causing some investors to take some chips off the table even on solid results. Second, anyone who bought in the fourth quarter is sitting on massive short-term gains. That’s likely triggering some profit-taking, too.
In any regard, we need to see where SHOP finds its footing here. North of $500 still bodes well for the bull case, although shedding almost all of its post-earnings gains would be discouraging for obvious reasons.
Let’s see if SHOP can hold the $550 mark. Once we have a day-range to trade against, investors can either play for retest of the highs or a break of Wednesday’s low, which will likely fill more of the recent gap.
Top Stock Trades for Tomorrow No. 4: CVS Health (CVS)
CVS Health (NYSE:CVS) is having a mild reaction to its earnings results, but there are still some positives on the weekly chart.
Going back to late 2016, one can see that the 200-week moving average has been resistance for quite some time (purple arrows). In Q4 2019, CVS broke out over this mark — and while it did fall back below it earlier this month, CVS reclaimed the 200-week moving average and continues to hold it as support (blue circle).
In its post-earnings action, shares are testing into the recent range highs. Now, see how CVS handles the $77.50 area. This too has been multi-year resistance. Over it, though, and $80-plus is possible.
If $77.50 holds as resistance, and/or CVS goes through a pullback, I want to see the 200-week moving average and uptrend support (blue line) hold as support.
Top Stock Trades for Tomorrow No. 5: CyberArk (CYBR)
In late 2019 and early 2020, CyberArk Software (NASDAQ:CYBR) put together nine consecutive gains, as shares rose from $117 to $140. From there, it formed a tight range between $137.50 and $142.50.
Unfortunately for bulls, that range is resolving lower — gapping below uptrend support (blue line) and the 50-day moving average. Now losing the 200-day moving average, CYBR stock is trying to hold the 100-day moving average.
Below the latter does not bode well for the bulls, as CYBR is clearly losing the momentum battle. Back over the 200-day moving average, and perhaps CyberArk can rally back to the 50-day moving average. Below Wednesday’s low, however, and $110 or lower could be 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.