After a volatile day at the Capitol on Wednesday, Thursday was more zen-like in the stock market with the S&P 500 blasting to a new record high. That said, let’s look at a few top stock trades ahead of the monthly non-farm payrolls release on Friday morning.
Top Stock Trades for Tomorrow No. 1: Bitcoin (BTC)
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I have said it before and I will say it again, Bitcoin (CCC:BTC) continues to move beautifully from level to level — it trades very technically.
Bitcoin paused at the prior all-time highs and the 161.8% extension near $20,000. It gave us a nice rally to $24,000 — the two-times range extension — where it again paused.
Then we had the 261.8% extension near $30,000, which turned to support after bitcoin pressed up to the three-times range extension. That’s about when it started getting a bit wobbly, jumping thousands of dollars in a few minutes.
Seriously guys, it’s all right here.
Bitcoin is now rallying to $40,000, the 361.8% extension. If bitcoin continues higher, $44,000 to $46,300 is in play. That’s the four-times range extension and the 423.6% extension, respectively. On the downside, look for support at the 10-day moving average.
A close below that mark may mean we need to shake out some of the weaker hands.
Top Stock Trades for Tomorrow No. 2: Walgreens Boots Alliance (WBA)
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Here we have a monthly chart of Walgreens Boot Alliance (NASDAQ:WBA), which can admittedly be difficult to trade.
On the smaller timeframes, there are obviously other considerations. However, my focus is on that $44.50 area. After acting as support earlier in 2020, it rejected Walgreens for months.
Most recently, the stock was rejected by this level in November and December. Clearing this level now though, WBA is bumping into the 21-month moving average. If it can hold $44.50 this month, that seems bullish to me.
Over the 21-day month moving average and the 200-month moving average is in play north of $50. Below $44.50 and perhaps $40 is back on the table. However, the stock is coming out of a nice multi-year falling wedge pattern. Let’s see if it has legs.
Top Stock Trades for Tomorrow No. 3: Elanco Animal Health (ELAN)
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Elanco Animal Health (NYSE:ELAN) traded really well on Wednesday despite the shakiness in the market. We called this rotation out earlier in the day and I was pleased with the way it closed.
While down on Thursday, the stock is holding above that $31 mark. Now let’s see if the stock can push higher and clear $32. Above $32 would put the November high in play near $32.80.
Above that, and the 2020 high is on the table just above $34.
On the downside, however, losing $31 could very well put the 21-day moving average in play if uptrend support doesn’t buoy the name (green line).
Top Trades for Tomorrow No. 4: Garmin (GRMN)
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Garmin (NASDAQ:GRMN) was another name I flagged, as it looks for a multi-week rotation higher. (I don’t post that to gloat by any means, only to source the information and give readers another outlet for the information).
Above we have a weekly chart, as the 10-week moving average continues to buffer the stock higher. Bulls now need to see a daily close over $122. That could kickstart a much larger move to the upside.
Specifically, the 261.8% extension from the September pullback comes into play at $129, while the 161.8% extension from the Q1 range comes into play up at $133. I would be looking to these areas as points of reference on a breakout.
On the downside, a close below the 10-week moving average and $117.50 level could put $112.50 in play, near the November low and at notable support.
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.
