Trading volume may be anemic, but that hasn’t stopped investors from pushing the indices to more new highs ahead of earnings. That said, let’s look at a few top stock trades as we approach mid-week.
Top Stock Trades for Tomorrow No. 1: American Airlines (AAL)
Click to Enlarge
Declining in its sixth-straight session and in eighth of the last nine days, American Airlines (NASDAQ:AAL) is attempting to locate a short-term bottom.
Shares are bouncing nicely from the 61.8% retracement and the 10-week moving average. A decline below Tuesday’s low may put the 50-day moving average in play too.
Below that, though, and we could see a sub-$20 move, landing AAL stock around $18.50. That’s a prior breakout spot and about where the 100-day and 21-week moving averages start to come into play.
Top Stock Trades for Tomorrow No. 2: Wells Fargo (WFC)
Click to Enlarge
Wells Fargo (NYSE:WFC) will kick off the earnings party on Wednesday before the open, along with a few others. After years of lagging its peers, WFC stock is finally trading pretty well on the long side.
The question now is, can Wells Fargo keep it up?
Correcting slightly ahead of the print, we need some clarity after the event. Specifically, I either want a deeper dip down to the $37 to $38 area or a push higher above the March higher.
If it’s the former, this area was recent support last month. It’s also where the 10-week and 50-day moving averages come into play. If that area fails, the $33 area could be next.
On the upside, however, the 61.8% retracement was resistance last month. A move above the March high at $41.54 could open the door to the $45 to $47 area. Near the latter is where the 78.6% retracement comes into play.
Top Stock Trades for Tomorrow No. 3: Riot Blockchain (RIOT)
Click to Enlarge
Riot Blockchain (NASDAQ:RIOT) is moving out of its wedge pattern as Bitcoin (CCC:BTC-USD) hits new all-time highs.
For the most part, the 10-week and 50-day moving averages continue to hold as support, doing just enough to guide Riot stock higher until it broke out over downtrend resistance.
From here, let’s see if Riot stock can climb to the 61.8% retracement and the $62 to $65 area. If it can clear the March high near $68, then a run toward the high at $79.50 is possible.
On a pullback, though, I don’t want to see Riot stock break below $50. That would put it below its moving average support and back below downtrend resistance.
Top Trades for Tomorrow No. 4: Tesla (TSLA)
Click to Enlarge
At least for now, Tesla (NASDAQ:TSLA) has its groove back. Shares are bursting over recent resistance near $700 and all of its key moving averages.
From here I want to see if it can fill the February gap near $780. Above that opens the door to $800-plus.
On the downside, however, it’s quite simple: We need to see prior resistance hold as support should the stock pull back. There’s a plethora of moving averages in that area too, which we want to see hold as support. Below opens up more possible downside.
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.
