It was a tricky session, as the market digests the Fed, first-quarter GDP results and big earnings reports as we approach the end of the month. With all of that in mind, let’s look at a few top stock trades for Friday.
Top Stock Trades for Tomorrow No. 1: Ford (F)
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Ford (NYSE:F) shares are under pressure after reporting earnings, sliding about 9.4% on Thursday.
The stock is declining right to last week’s low and the 21-week moving average. From here, bulls technically have a low-risk buying situation in the sense that they’ll know quite quickly if they’re wrong or not.
A close below Thursday’s low would indicate they are wrong and could put $10.40 in play. On the upside, though, let’s see if shares can reclaim $12.
Above $12, and perhaps the 161.8% extension is possible.
Top Stock Trades for Tomorrow No. 2: McDonald’s (MCD)
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We’re also using a weekly chart of McDonald’s (NYSE:MCD) to highlight some of the longer-term levels we’re watching.
The stock is up slightly after reporting earnings, as McDonald’s works on its fourth-straight weekly gain and its eighth weekly gain in the last nine weeks.
Some consolidation around the $230 area or a dip to the 10-week moving average wouldn’t be unhealthy at this point. However, should the bullish trend remain intact, let’s see if we can get a push up to the 161.8% extension, fittingly near $150.
Below both of those potential support zones — the 10-week moving average and $230 — could put the $221 area in play.
Top Stock Trades for Tomorrow No. 3: Qualcomm (QCOM)
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Qualcomm (NASDAQ:QCOM) is up on earnings too, but investors are selling into that strength a bit.
Specifically, shares finally gave us a more clear monthly-up rotation over $140.13. While we saw that rotation earlier this month, the stock just sort of bubbled along this level — it didn’t rotate with authority.
Well, now it is and the only thing seemingly standing in its way is the 100-day moving average, which is rejecting the stock on Thursday. Above the post-earnings high — and thus, the 100-day — could put $150 in play. Above $152, and Qualcomm can start filling in some of that gap, up toward $162.
On the downside, however, a break of $140 and the 10-week moving averages does not bode well for bulls. Even if the downside is limited, the momentum will likely be sapped in that scenario.
Top Trades for Tomorrow No. 4: Caterpillar (CAT)
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Caterpillar (NYSE:CAT) is enduring a mild pullback after reporting earnings.
Shares are dipping down to the 10-week and 50-day moving averages, giving bulls a make-or-break feeling from here.
These two moving averages have been support for months now. It’s no surprise that Caterpillar stock initially bounced from this zone. However, the question becomes how long the bounce can last.
I’d love to see some confirmation here. Specifically, I’d love a tight-ranged inside day on Friday, then a daily-up rotation on Monday — or something of similar magnitude.
Aggressive bulls will be long right here, right now and use Thurday’s low as their stop. That’s fine too. Either way, over the $236 to $238 area likely puts $250 to $252 in play.
On the downside, though, a break of $222.50 puts $208 to $214 on the table.
Top Trades for Tomorrow No. 5: Lyft (LYFT)
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Lyft (NASDAQ:LYFT) is dipping too, only unlike the other four names on this list, it isn’t doing so on earnings. That comes next week.
Shares are selling off hard on the day, dropping almost 10% and cutting below a number of key moving averages. Furthermore, Lyft is trading below this month and last month’s low.
However, the stock is catching a bounce from the 100-day and 21-week moving averages, as well as the pre-coronavirus 2020 highs. Below $54.50, and this name may continue lower, potentially down to $50. Below that, and perhaps they dump it down to the 200-day moving average.
Keep an eye on last month’s low near $56.64 to $56.75. If it can’t reclaim this area, the seller might keep a lid on Lyft. Back above it, and we could get a move to the $58.50 to $59 area, then $61.50.
On the date of publication, Bret Kenwell held a long position in QCOM.
Bret Kenwell is the manager and author of Future Blue Chips and is on Twitter @BretKenwell.
