Stocks surged higher on Monday, with hopes for a vaccine growing. However, many coronavirus stocks took it on the chin. That said, let’s look at a few top stock trades for Tuesday.
Top Stock Trades for Tomorrow No. 1: Beyond Meat (BYND)
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Beyond Meat (NASDAQ:BYND) was volatile on Monday. Shares gapped up by 4.7% to start the day, fell 14.2% from the highs and spiked 21% from the lows before settling down.
In the end, shares are down just 4% from Friday’s close on Monday. The move comes after some drama with McDonald’s (NYSE:MCD) and ahead of earnings tonight after the close.
I need to see some clarity before getting long on BYND stock. Specifically, shares need to clear $160. Not only was that the breakout level from September, but it would also put Beyond Meat over the 10-day, 20-day and 50-day moving averages. Finally, it would put it over downtrend resistance (blue line).
Even better would be a move above Monday’s high at $170.80. That would open up a move back to the October highs in the $190s.
A break of Monday’s low and the October lows near $140 would put $120 support and the 200-day moving average on the table.
Top Stock Trades for Tomorrow No. 2: McDonald’s (MCD)
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Speaking of McDonald’s, let’s look at the chart. Not only was it caught up in some plant-based confusion with Beyond Meat, but it reported earnings before the open.
Like BYND stock, shares have been volatile. McDonald’s gapped up toward $230 resistance, flirted with a break of $210 support and is now less than 1% away from Friday’s closing price.
Also like Beyond, I want more clarity with MCD stock. Specifically, I want to see if shares can reclaim the 10-day and 50-day moving averages. Above the latter and Monday’s high is in play near $228.
Above $228 puts $230 resistance back on the table. If McDonald’s clears that area, the 123.6% extension is possible up near $236.
On the downside, a break of $210, the 100-day moving average and Monday’s low at $207.17 puts the $200 mark and the 200-day moving average on the table.
Top Stock Trades for Tomorrow No. 3: Canopy Growth (CGC)
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After a handful of strong sessions, Canopy Growth (NYSE:CGC) burst even higher on Monday. At its highs, shares ripped 14.7% after the company reported earnings.
From last Wednesday’s low, the stock has rallied almost 30%.
The move initially took out the prior 2020 high, but CGC stock was unable to sustain above that $26 area. If shares continue to pullback, let’s see if $22 can act as support. That’s assuming the 10-day moving average doesn’t catch up to the price first.
Above $26, and Monday’s high at $26.95 is possible. Above that and eventually bulls will start sniffing for a gap fill back up toward $32 from August 2019.
Top Stock Trades for Tomorrow No. 4: JPMorgan (JPM)
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Coronavirus stocks were hit hard, while economically-sensitive stocks ripped. JPMorgan (NYSE:JPM) was among the stocks rallying hard, up 13% to end the day.
The big gap-up helped launch JPM stock over $105 resistance and the 50-week moving average. That mark had served as notable resistance all three times it has been tested since the pandemic began.
Perhaps more importantly though, shares cleared $110 resistance and the post-pandemic highs from June at $113.60. From here, I would love to see JPM stock hold above the $110 to $114 area. Below and the $105 area needs to hold as support.
On the upside, it would take a notable rally, but it would be great to see the stock fill the gap between $127 and $132.
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.
