As chaos ensues in Washington and as we wrap up the Senate vote in Georgia, the market is mixed as we head into Thursday. That said, let’s look at a few top stock trades.
Top Stock Trades for Tomorrow No. 1: Alibaba (BABA)
Concerns linger on Alibaba (NYSE:BABA) and whether the stock will be delisted by the NYSE, causing shares to slip lower on the day.
The stock previously caught a nice bounce off the $211 area. That bounced fizzled out north of $240 as shares again turned lower. Should Alibaba lose $225, it could open up another test of the $211 area.
There Alibaba finds the December low, 100-week moving average and 161.8% extension of the recent dip.
If that level fails, it could put the $188 to $196 area on the table, where the stock will find VWAP support and the 200-week moving average. The 50-month moving average also comes into play near $183 at the moment.
Top Stock Trades for Tomorrow No. 2: Invesco Solar ETF (TAN)
The Invesco Solar ETF (NYSEARCA:TAN) has been raging higher. It’s working on its 10th-consecutive month of gains, and ended Wednesday up nearly 9% alone.
Let’s try to keep this one simple, because entering now would force bulls to adapt a very wide risk range. Meaning shares could give up a lot of ground and still be in a healthy state.
If TAN takes out Wednesday’s high at $119.27, then look for a push to the 261.8% extension at $123.32.
If it loses today’s low at $111.70, then let’s see if $108 and the 10-day moving average can support it. However, if not, true trend support could be on the table at the 10-week moving average, followed by the 50-day moving average.
Top Stock Trades for Tomorrow No. 3: Small Caps (IWM)
Obviously, Wednesday has been a wild day with what’s happening in Washington D.C.
However, small caps held up well all day. And despite the news, the Russell 2000 ended the day up about 4%.
The iShares Russell 2000 ETF (NYSEARCA:IWM) gapped up and hit new all-time highs on the day. Like the rest of the market though, it has backed off those highs by the close.
Keep an eye on $199. If it loses this mark, a return to the 21-day moving average is likely. Below that, and the $185 to $188 area is on the table.
If it can take out this weeks’ high, look for an eventual push to the 161.8% extension.
Over the last three months, the Russell is up 30%. The next best performer is the Nasdaq Composite, up 13%. The Russell is the clear relative strength leader, so keep that in mind moving forward.
Top Trades for Tomorrow No. 4: Aurora Cannabis (ACB)
Aurora Cannabis (NYSE:ACB) and the rest of the cannabis space caught a big boost on Wednesday. However, the stock is struggling to hold onto its gains.
ACB stock gapped up, opening over $11 per share. While it cleared the 50-week moving average initially, it did not close above it. So now, investors must be on the lookout for a test of the $9.50 area.
There it will find the 10-day, 21-day and 200-day moving averages, as well as VWAP support. A break below puts the December low in play near $8.20.
If ACB stock can reclaim the 50-week moving average and take out Wednesday’s high, it puts the December high in play at $12.19 — followed by the November high near $14.50.
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.