It was a tough day for the bulls on Friday, with the stock market getting walloped right off the open. That said, let’s look at a few top stock trades as we approach the end of June.
Top Stock Trades for Monday No. 1: Facebook (FB)
Click to Enlarge
Facebook (NASDAQ:FB) is taking it on the chin as a growing number of companies begin to boycott their advertisements on the company’s platform. As if the hit to ad sales weren’t enough during the novel coronavirus, this presents a new revenue risk.
The prior high at $225 acted as a springboard for the stock, as Facebook gapped over this mark, then held it as support. At the same time, $240 was acting as resistance.
Now, though, $225 is giving way, as Facebook fills the May gap down toward $215. In the short-term, the stock faces a critical level. If it fails to hold the 50-day moving average near $217 and Friday’s low, the $200 to $205 area could be on the table.
There it finds prior support, as well as the 200-day moving average. On the upside, bulls need to see Facebook above the 50-day moving average, then reclaim $225. If $225 acts as resistance, that is not a good sign in the short term.
Top Stock Trades for Monday No. 2: Fastly (FSLY)
Click to Enlarge
Man, how fun is this one? Fastly (NYSE:FSLY) just keeps on ripping higher. When shares broke out over $50, I was looking for a test of $60, which is the two-times range extension.
Above $60 puts the $75 level in play, near the 261.8% extension. I didn’t think FSLY would clear this mark so quickly, but if it did, we said to look for a test of the three-times range extension, near $84.50.
Powering through that mark now, FSLY is a runaway train. Eventually this train will stop, however, and bulls who trimmed on the way up but kept some for the ride have to be smiling ear to ear.
On the upside, maybe this can push up to the 361.8% extension at $99.63. A run to $100 would be something, I don’t know what else to say at this point. On a larger dip, see how the stock does on a test of the 20-day moving average, followed by $50.
Top Stock Trades for Monday No. 3: Nike (NKE)
Click to Enlarge
Nike (NYSE:NKE) hit the Street with a top- and bottom-line miss, as well as a surprise loss for the quarter. As great of a company as Nike is, it didn’t deserve to be trading within 3% of its all-time high with that result.
Dipping now, aggressive bulls may have a buying opportunity. Between $90 and $94, NKE has its 50-day, 100-day and 200-day moving averages, as well as uptrend support (blue line).
If these areas fail to buoy the name, you’ll know for certain that bulls can’t garner any momentum. Below that area puts a gap-fill in play near $87, followed by $84. If the selling accelerates aggressively, it’s possible we get a gap fill down to $72.50, but let’s go one level at a time considering shares are up near $94 at the moment.
If the $90 to $94 area does hold as support, though, see that Nike stock eventually reclaims $100 — putting $105 resistance in play.
Top Stock Trades for Monday No. 4: Gap (GPS)
Click to Enlarge
Gap (NYSE:GPS) ended the day up neaely 19%. However, it’s so far far off its highs that it’s concerning.
The stock hit its highest level since February, but was ultimately rejected by the 200-day moving average and the prior June high near $13.75.
Right in the middle of its range, I either need lower prices or a move higher. On a dip, see that shares stay over $10 and uptrend support (blue line). Below $10 and the stock loses all credibility, even with so much volume on the day. If it loses $10, $9 could be back in play.
On the upside, however, let’s see if Gap can clear $14. That would put it above the prior June highs, as well as the 200-day moving average. Above Friday’s high at $14.45, and $15 is possible, which was a former significant support level.
Bret Kenwell is the manager and author of Future Blue Chips and is on Twitter @BretKenwell. As of this writing, Bret Kenwell is long FSLY.
