Stocks caught a boost after the May jobs report was good but not great and slightly missed expectations. That has investors thinking the labor market is recovering, but the Fed’s “easy money” policies are still needed. Now, let’s look at a few top stock trades.
Top Stock Trades for Monday No. 1: Nvidia (NVDA)
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Nvidia (NASDAQ:NVDA) has been on a torrid run. Shares are up almost 30% in just 12 trading sessions and have rallied in 11 of those sessions. It’s one down day was to the tune of a 1.35% decline. Not bad.
In a somewhat interesting observation, shares actually dipped on earnings a few weeks ago, then rallied the following day. The late rally kickstarted this massive move we’re seeing now.
But are we running out of steam?
Whether we use the larger and deeper range or the most recent, both measures have the 161.8% extension coming into play between $708 and $716. It wouldn’t be odd to see some profit-taking up here — or at least a pause.
However, Nvidia is a tough one because it runs a fantastic business and has been consolidating for several quarters. From an investment perspective, bulls may not want to part ways with the stock, even if some type of dip could occur.
On a pullback, keep an eye on the 10-day moving average and the $650 level. A test of either may be good for a bounce.
On the upside, a move through $717 could put $750 to $766 in play.
Top Stock Trades for Monday No. 2: Lululemon (LULU)
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Lululemon Athletica (NASDAQ:LULU) isn’t giving us much to work with after earnings, but it’s better than nothing. Shares ended the day on Friday up nearly 4%.
In April, the stock broke out of a brutal downtrend, but it struggled to maintain momentum over the 200-day moving average. The correction in May didn’t send the stock back to its lows — which is good — but we’ve seen a narrowing wedge pattern form since that decline.
Now testing into wedge resistance, bulls are anxious to see if Lululemon can garner some momentum. If it pushes through this mark, see if shares can go monthly-up over $331.64. Above that puts the 200-day moving average in play, followed by the April high at $347.
If LULU stock can’t push through resistance, see if the 50-day moving average and wedge support buoy the stock. If not, the low $300s could be in play.
Top Stock Trades for Monday No. 3: Broadcom (AVGO)
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Broadcom (NASDAQ:AVGO) also isn’t giving us much to work with after earnings, ending Friday up 2.2%. Also like Lululemon, the stock isn’t breaking down but it’s starved for upside momentum.
Shares continue to struggle with the $478 area. If the stock can push through Friday’s high (and thus this week’s high), perhaps we can get some sort of rotation higher.
If that’s the case, $490 could be in play. That’s been stout resistance. Above that and $500-plus is possible.
On the downside, watch for a dip down to the 10-day and 50-day moving averages. Below could put $450 and the 21-day moving average in play. Below that and the $425 range support area is on the table, along with the 200-day moving average.
Top Trades for Monday No. 4: SoFi Technologies (SOFI)
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Earlier this week, SoFi Technologies (NASDAQ:SOFI) rocketed out of its recent base once its ticker change from “IPOE” to “SOFI” occurred. In that run, shares rallied to $24.95.
Since then, we’ve seen a harsh two-day decline back below the 61.8% retracement and a brief dip below the 10-day moving average. Bouncing from the 10-day now, let’s see if the stock can stay above this measure.
If it can’t, Friday’s low remains vulnerable. Below it puts the 21-week, 10-week and 21-day moving averages in play. That may be a decent buying opportunity for bulls.
Back above $22.50 — around where the 61.8% retracement comes into play — puts this week’s high in play near $25. Above that and perhaps the high at $28.26 is possible.
On the date of publication, Bret Kenwell held a long position in NVDA. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Bret Kenwell is the manager and author of Future Blue Chips and is on Twitter @BretKenwell.
