The S&P 500 hit more record highs on Friday as we continue to carefully crawl higher ahead of earnings season. That said, let’s look at a few top stock trades ahead of next week.
Top Stock Trades for Monday No. 1: Amazon (AMZN)
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Amazon (NASDAQ:AMZN) and its FAANG peers have been trading much better lately. It’s also a great example of using multiple timeframes.
On the daily chart — which is not shown above; instead it’s a weekly chart — traders will notice that Amazon broke below the 200-day moving average. Technically, it looked to be in a state of failure.
However, the 50-week moving average held perfectly. While shares consolidated below the 10-week and 21-week moving averages for a few weeks after the bounce, AMZN STOCK eventually broke out over these measures.
Now surging into prior range resistance, let’s see if buyers can boost it out of this range. If they can, the 2021 high is in play at $3,434, followed by the $3,500 area.
On the downside, though, bulls want to see the 10-week and 21-week moving averages act as support. However, they have to see the 50-week moving average hold. Below puts the 2021 low in play.
Top Stock Trades for Monday No. 2: WD-40 Company (WDFC)
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WD-40 Company (NASDAQ:WDFC) is getting hammered on earnings. It doesn’t need lubricant, it needs some duct tape.
Poor puns and references aside, the stock is leaving some question marks when it comes to the chart — but also, some opportunities.
On the one hand, we have a dip right to the 10-month moving average and a gap-fill through $271. On the other hand, we’re still a ways above the 200-day moving average and only in “day one” of the selloff, which can tend to last three or more days.
From here, proceed with an open mind. Long above Friday’s low is a reasonable approach, as is adding or initiating a position back over $271.
However, a close below Friday’s low could very well put more downside in play, potentially down to the 200-day moving average.
Top Stock Trades for Monday No. 3: Levi (LEVI)
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While WD-40 Company is getting hit on earnings, Levi (NYSE:LEVI) is on the move higher after its quarterly results.
Shares continue to trade really well, riding the 10-week moving average higher. This is the price action you want to see if you’re long.
However, shares are fading off Friday’s high and thus, this week’s high. Keep an eye on $24.50, the 2019 high that came shortly after Levi’s IPO. A break of this mark and the 10-week moving average could put the $22.50 to $23 area in play, as well as the 21-week moving average.
On the upside, though, a move above Friday’s high — at $27.30 — puts the 161.8% extension in play at $27.88. Above that opens the door to $30-plus.
Top Trades for Monday No. 4: Clover Health (CLOV)
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Clover Health (NASDAQ:CLOV) has been battered from its December and January highs. Down more than 50% now, and bulls are looking for an opportunity.
The stock continued to find buyers around $7 and rocketed higher on Thursday, ultimately reclaiming the 10-day and 21-day moving averages. Shares even briefly rotated over the March high at $9.08, but have since retreated.
Dipping on Friday, Clover is now finding support at those moving averages. That’s pretty healthy price action and does give dip-buyers an opportunity. A close below $8 could put $7 back on the table.
Below $7, and CLOV stock likely retests the low near $6.31.
However, above this week’s high could put the $9.75 area and 50-day moving average 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.
