A poor jobs report and news that President Donald Trump has tested positive for Covid-19 weighed on the stock market on Friday. With that in mind, let’s get to some top stock trades in the meantime.
Top Stock Trades for Monday No. 1: Nio (NIO)
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Nio (NYSE:NIO) reported solid third-quarter delivery results on Friday, but you wouldn’t know it by the stock’s reaction. Same with Tesla (NASDAQ:TSLA).
However, unlike Tesla, Nio stock isn’t wavering as much. In fact, the stock is holding up near its prior breakout level.
In late August and early September, Nio stock was rejected by the $21 level. It didn’t help that the company raised additional funds and the stock market took a solid dip (as did Tesla).
However, Nio never broke stride, as uptrend support continued to hold (blue line). This week, shares were able to breakout over $21 and hit the 161.8% extension (for the entire range).
Let’s see if the stock can continue to hold up over the 10-day moving average. If it can, it will keep bulls looking for a move over $22.59, the current all-time high. Above that could trigger a rally to the two-times range extension all the way up near $26.40.
On the downside, a break of the 10-day moving average puts uptrend support and the 50-day moving average in play.
Top Stock Trades for Monday No. 2: Bed Bath & Beyond (BBBY)
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Earlier this week, Bed Bath & Beyond (NASDAQ:BBBY) reported a much better-than-expected earnings result. Now, shares are ramping higher on the week, up more than 40%.
The stock is reclaiming a vital mark near $17.50, as well as the declining 200-week moving average. I know it’s quite the rally, but as long as shares are over $17.50, I find it hard to be bearish.
Plus, this stock had a short interest north of 60%. That puts the potential for a massive short squeeze higher on the table. If BBBY can rally further, look to see if it can extend up to the 138.2% and 161.8% extensions at $22.73 and $26.02, respectively.
Top Stock Trades for Monday No. 3: American Airlines (AAL)
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American Airlines (NASDAQ:AAL) is trying to get some upside momentum going. Shares are struggling with the 10-day, 20-day and 50-day moving averages.
If AAL can gain momentum over these marks, it puts $14 resistance in play. Above $14 could really get the group moving, potentially putting the 200-day moving average on the table.
The $14 level was resistance in June. Above that and the 38.2% retracement is possible.
On the downside, a break of this week’s low at $12 could put recent range support on the table near $11. If the stock gets there and it holds as support, it’s more wait-and-see trading from AAL as it remains rangebound.
A close below $11 support is more bearish, though.
Top Trades for Monday No. 4: Virgin Galactic (SPCE)
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Virgin Galactic (NYSE:SPCE) has a great-looking chart right here.
The stock exploded higher on Monday, rallying about 25%. And all week the stock has been forming this nice-looking bull flag.
That action comes as the 50-day moving average continues to hold as support and as the 10-day moving average finally catches up to the stock.
Now what?
I want to see a rotation over this week’s high at $20.98 and longer-term resistance at $21. Above that could get a quick move to the 38.2% retracement, up at $21.83.
From there we’ll need to see how SPCE stock is trading. However, above this level could open the door to the 50% retracement at $25.78. It also puts the $26 to $27.50 area on the table, which came into play near the July highs.
On the downside, a break of the 200-day moving average — which was solid support until September — would be very damaging to the bull case in the short term. It could put a gap-fill in play toward $16.50, followed by support at $15.
On the date of publication, Bret Kenwell did not have (either directly or indirectly) any positions in any of the securities mentioned in this article.
Bret Kenwell is the manager and author of Future Blue Chips and is on Twitter @BretKenwell.
