Despite a lackluster jobs report, stocks popped at the open on Friday and ran to new highs. However, equities are starting to look a little vulnerable. With all of that in mind, let’s look at a few top stock trades for Monday.
Top Stock Trades for Monday No. 1: Micron (MU)
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Micron (NASDAQ:MU) is down 2% in its post-earnings move, but the bearish engulfing candle it sports right now doesn’t look great.
In a best-case scenario, bulls would get right back to work and drive this name back over the pre-earnings high at near $80 and the 161.8% extension. That would put Friday’s high on the table near $84, followed by the two-times range extension.
On the downside, shares are into this $77 area, a zone that Micron struggled with ahead of earnings. If it can hold, perhaps the 10-day moving average can give it a lift.
Below that, though, and a retest of the $74 area and 21-day moving average could be in the cards. Below that, and $70 and the 10-week moving average are next.
Top Stock Trades for Monday No. 2: Gold ETF (GLD)
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Gold was trading really well — until Friday.
The SPDR Gold Trust ETF (NYSEARCA:GLD) was off to a great start this year.
We were looking for it to rotate over the November high and it came up just short of this mark. The decline in the following session filled the gap. Then, we had an inside day.
Many bulls were likely caught off-guard by Friday’s decline. The gap-down plunge quickly blew through the 50-day and 10-week moving averages. However, it’s finding support at the 200-day moving average.
Bulls have Friday’s low to measure against if they want to go long, but there’s no shame in giving this one a few days to sort itself out.
On the upside, we need to see a move back through the 50-day moving average. On the downside, though, a break of Friday’s low puts the gap-fill back in play at $167.43 — followed by a possible retest of the breakout area near $164.50.
Top Stock Trades for Monday No. 3: Spotify (SPOT)
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Spotify (NYSE:SPOT) has been trading really well, particularly over the last few days.
Shares broke out over downtrend resistance on Thursday, reclaiming the 10-day moving average that was resistance in the prior session. Now pressing through the prior high, bulls are looking for this name to continue higher.
If the $350 area acts as resistance, see that the 10-day moving average buoys this stock on a dip. If it continues higher, $372 is on the table, followed by the $380 to $387 area.
Top Trades for Monday No. 4: Carnival Cruise (CCL)
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Carnival Cruise (NYSE:CCL) will seemingly report earnings on Monday before the open.
After breaking out over the 50-week moving average in December, CCL stock has been holding this mark as downtrend support, while the 10-week moving average also gives it a boost.
On the upside, the 10-day and 21-day moving averages have been resistance. Hopefully earnings will give us more clarity with this one.
On the downside, I want to see the 50-day, 50-week and 23.6% retracement hold as support. Below opens up a possible gap-fill toward $16. On the upside, a break of the 10-day and 21-day moving averages could trigger a rally.
Specifically, it will put the 38.2% retracement in play, which has been resistance both times it’s been tested following the selloff from March. Above puts $30 and the 50% retracement on the table.
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.
