We got another new record high in the S&P 500 as stocks continue to march higher ahead of earnings season. Now, let’s look at a few top stock trades going into next week.
Top Stock Trades for Monday No. 1: Boeing (BA)
Shocker: Boeing (NYSE:BA) has more negative news about its 737 MAX jet, which is causing some selling pressure in the stock.
As a result, shares are breaking below the 61.8% retracement, as well as last week’s low. If Boeing loses the $245 level, it could create some selling pressure down toward the 10-week and 50-day moving averages, around $237 to $240.
Below that, and $232 is on the table, followed by the 100-day moving average.
On the upside, though, a two-times weekly-up rotation would negate all of this bearish talk — propelling BA stock over the last two weeks worth of highs and the 100-week moving average. Above that, and Boeing stock can really take off.
Top Stock Trades for Monday No. 2: Morgan Stanley (MS)
Morgan Stanley (NYSE:MS) is moving lower after the company reported earnings, as it struggles to hold above short-term support.
Despite beating on earnings and revenue estimates, Morgan Stanley is breaking below the 10-day, 21-day, 50-day and 10-week moving averages. It’s also trading down to last week’s low.
If it gives us a two-times weekly-down rotation, it could put sub-$75 in play down to the 21-week and 100-day moving averages.
On the upside, however, a move back above $80 alleviates some of the selling pressure. But over $82 puts the highs back in play. While I like the financial stocks, I’m cautious with Morgan Stanley until it can prove otherwise.
Top Stock Trades for Monday No. 3: Walmart (WMT)
Walmart (NYSE:WMT) is a name I’ll be watching closely next week.
Last week, we got a weekly-up rotation, as well as a monthly-up rotation, as Walmart cleared both the prior week’s high and the March high.
This week, shares nearly challenged the prior week’s high, but backed off those levels as it came into the 21-week moving and downtrend resistance (blue line). It’s also giving us an inside week, as this week’s range is entirely contained within the prior week.
So, what am I getting at here? Next week — and preferably, early next week — I’d love to see a rotation over $141.12 that builds momentum, as shares go two-times weekly up over the 21-week moving average.
That could pave the way for a move to $144.50 (gap fill), followed by $148, then $150-plus.
If that setup comes to fruition, some traders may consider using this week’s low as their stop-loss.
Top Trades for Monday No. 4: Alcoa (AA)
Alcoa (NYSE:AA) is trading nicely after earnings, hitting new 52-week highs in the process.
Now over $35, let’s see if shares can rally to the 200-month moving average, then the 261.8% extension near $40.
On the downside, though, keep it simple. Look for the 10-week moving average to continue acting as support. Below the 200-week moving average and $26 is on the table.
Top Trades for Monday No. 5: Coca-Cola (KO)
Coca-Cola (NYSE:KO) will report earnings on Monday before the open. The stock has been very responsive between its 50% and 78.6% retracements.
From here, I would love to see a multi-week rotation higher, sending KO stock to the 78.6% retracement near $55 and preferably above this mark. A weekly close above $55 would open the door to $60, and potentially give Coca-Cola some much-needed momentum.
On the flip side, I would be a buyer on a pullback to the 200-week moving average and the 50% retracement, near $48.
On the date of publication, Bret Kenwell held a long position in WMT.