Stocks started off under pressure on Tuesday, but found their footing as earnings season gets underway. With that in mind, let’s look at a few top stock trades for Wednesday.
Top Stock Trades for Tomorrow No. 1: JPMorgan (JPM)
For both JPMorgan (NYSE:JPM) and Delta Air Lines (NYSE:DAL), a little more post-earnings movement would have been nice. At least, from a trading perspective.
JPMorgan kicked off earnings seasons with a top- and bottom-line beat. However, the stock is not moving all that much. On the plus side, though, it’s not going down (and that price action may be an even larger positive for Delta).
Sticking with one of, if not the best bank in the sector, this name is giving us a tight two-day pre- and post-earnings range. That is very unusual in any stock.
Below the two-day low (from yesterday) at $96.31, and the stock is likely to test into the 20-day and 50-day moving averages currently near $95.20. Below that puts $91 in play, followed by uptrend support.
Over the two-day high (from today) at $99.95, puts $102 in play, followed by the 50% retracement near $106. Above that, and the 200-day moving average and the June high up at $114.65 are possible.
Top Stock Trades for Tomorrow No. 2: Delta (DAL)
As for Delta, the lack of upside is concerning. While admittedly the airline did report a brutal quarter, we don’t care about the quarter. Instead, we care about the reaction to the quarter — which is always more telling.
If I’m looking to get long, I need some clarity. On the upside, that comes from clearing $29.50. That puts Delta above the notable $27.50 level, as well as all of its major moving averages.
As it stands, it’s below all of these marks, and that creates a problem for bulls.
If the floor falls out, see how Delta stock does on a drop into the $21 to $22 area. If it gets there, this zone may be support. Below puts the May low in play at $17.50.
Top Stock Trades for Tomorrow No. 3: Fastenal (FAST)
Fastenal (NASDAQ:FAST) is a fun one. This stock has been trading well lately, and briefly ran to new highs on its earnings report. However, shares have since given up those gains and are now trading flat.
From here, I really want to see it hold $42.38. That’s the two-week low, which also comes into play near the 20-day moving average and uptrend support (blue line).
All hope is not lost if this level breaks, though. It simply puts the 50-day moving averages and $40 level in play. However, if the level holds, a retest of $45 could be in play, as well as a breakout to new highs.
Above $45 puts the 161.8% extension in play at $46.76.
Top Stock Trades for Tomorrow No. 4: Inovio (INO)
While Inovio Pharmaceuticals (NASDAQ:INO) burst higher by more than 22% at one point on Monday, shares ended higher by “just” 9.5% on the day. After a strong open on Tuesday, Inovio again flushed lower, this time giving up all of its gains on the day.
So, what now?
Luckily, bulls have a pretty clear roadmap. On the upside, we must see INO clear this week’s high at $28.54. Above that opens the door to the $32 area, and puts the $34 high on the table.
Above that — with the two-times range extension coming into play at $33.59 — puts the 261.8% extension on the table at $42.38.
On the downside, however, see that shares hold up over the 20-day moving average — currently at $22.23. If shares lose this mark, it means INO will be below the 10-day and 20-day moving averages, uptrend support (blue line) and prior resistance at $24.
It could potentially create enough selling pressure down to the 50-day moving average. That doesn’t mean INO stock will fall to the 50-day, just that it can. But that starts by losing the 20-day.
Bret Kenwell is the manager and author of Future Blue Chips and is on Twitter @BretKenwell. As of this writing, Bret did not hold a position in any of the aforementioned securities.