It was a volatile session in the stock market on Thursday, although bulls repaired some of the damage that stocks observed in the morning. With that in mind, let’s look at a few top stock trades.
Top Stock Trades for Tomorrow No. 1: Roku (ROKU)
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This is a somewhat loaded Top Stock Trades, starting with a favorite among investors: Roku (NASDAQ:ROKU).
Shares burst higher, ripping nearly 12% on the day. It vaulted shares over $135 resistance and more importantly, ended its painful stretch of lower highs, dating back almost a year.
The stock is approaching the 78.6% retracement and the 2020 high near $151. Above that puts the Q4 high in play at $168.85, followed by the all-time high at $176.55. Just for those that are curious, a breakout over the all-time high could put $200 in play, with the 123.6% extension up at $204.48.
Top Stock Trades for Tomorrow No. 2: Advanced Micro Devices (AMD)
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Despite a bumpy overall market on Thursday, Advanced Micro Devices (NASDAQ:AMD) also made a powerful move higher.
Shares had been hugging the 20-day and 50-day moving averages, and I was looking for this level to give way just earlier this week. It did so in a powerful manner, with AMD also clearing downtrend resistance (blue line).
Now the $58 to $59 area looms large, as it has been resistance all throughout 2020. Above $59.27 puts the stock in breakout mode, and puts the 123.6% extension in play near $64.50.
On the downside, though, I need to see the 50-day moving average hold as support. Below is not a good development for bulls. Below $54.45 — the 78.6% retracement — will have me cautious.
Top Stock Trades for Tomorrow No. 3: Virgin Galactic (SPCE)
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Virgin Galactic (NYSE:SPCE) was another one I had my eye on, as the price action was getting very coiled and tight.
With today’s upside move, shares are clearing downtrend resistance (blue line) and are rotating over last month’s high at $18.70. Ideally, this $18.70 level will hold as support and put $20-plus in play.
Above $20 puts the 38.2% retracement in play at $31.83. Below, however, puts the 50-day moving average back in play at $16.50, technically speaking.
Below $14 is a very bad look for SPCE, as it puts it at multi-month lows and below a number of key support levels.
Top Trades for Tomorrow No. 4: Walgreens (WBA)
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Walgreens Boots Alliance (NASDAQ:WBA) continues to trade poorly, as the stock hits its lowest levels since May. Poor earnings are the culprit for Thursday’s action, but the bearish trend has been in play for a while now.
Just look at the weekly chart here, which highlights the lower highs WBA has been making for years now. Even more recently, shares were rejected from the $47.50 level, a significant support level from 2019. That’s a very bearish development.
It doesn’t help that WBA has been unable to reclaim the 20-week moving average, which has been squeezing the share price lower.
From here, see if WBA can close above the 20-week moving average. Otherwise, it keeps the 52-week low in play at $36.24.
Top Trades for Tomorrow No. 5: Bed Bath & Beyond (BBBY)
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Doing worse than Walgreens is Bed Bath & Beyond (NASDAQ:BBBY), which ended the day down 24.5%.
The move thrusts shares below the 20-day moving average and uptrend support (blue line), as shares teeter on the 50-day moving average and as the 200-day moving average is cemented as resistance.
If shares fail to hold the 50-day moving average, see if the 23.6% retracement acts as support. Below is a no-touch in my view. And if either hold as support, see if BBBY can retest the 200-day moving average.
Bret Kenwell is the manager and author of Future Blue Chips and is on Twitter @BretKenwell. As of this writing, Bret is long ROKU and AMD.
