Stocks opened lower to start the week and clawed back some of the deficits, although the Russell 2000 had a great day, up almost 1.5% on Monday. With that in mind, let’s look at a few top stock trades.
Top Stock Trades for Tomorrow No. 1: Aurora Cannabis (ACB)
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Aurora Cannabis (NASDAQ:ACB) reported earnings after the close and boy, this stock has really been struggling. That’s even as some of the other cannabis stocks have been fetching a bid.
Can earnings turn it around?
Lately, the $6 level has been decent support. Bulls will want that to remain the case after the print, but they’ll really want to see ACB stock avoid a close below last week’s low of $5.85. That’s also the September low, for those that are curious.
On the upside, let’s see if shares can clear the 50-day moving average. Above the 50-day puts the $7.50 resistance level in play. Above that could set the tone for a push up to the 50-week and 200-day moving averages.
Top Stock Trades for Tomorrow No. 2: Ford (F)
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Ford (NYSE:F) shares have been trading great lately, haven’t they? Earlier this month, we flagged the “ABCDE” correction, followed by the breakout over downtrend resistance.
After a quick dip, Ford stock has now ripped off four-straight days of gains. That’s been good for a gain of nearly 12%.
From here, I want to see how Ford stock handles itself. If it continues to push higher, let’s look for a test of the 61.8% retracement of the current range, near $15. A push above $15 could eventually put the recent high of $16.45 back on the table (but not before some pullbacks along the way).
On a dip, though, I need to see the 50-day and 10-day moving averages act as support.
Top Stock Trades for Tomorrow No. 3: Lordstown Motors (RIDE)
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I have not been a big fan of Lordstown Motors (NASDAQ:RIDE), and even though the recent price action has been good, it doesn’t mean I’m going to become an overnight bull in this one.
That said, shares continue to ride the 10-day moving average higher. If RIDE stock can clear last week’s high of $8, it puts the notable $9 level in play. This level went from solid support in the second quarter to resistance in Q3.
Which role will it play for Q4? We won’t have to wait long to find out.
If shares clear $10, see how RIDE stock handles the 10-month moving average. Above it puts the 200-day in play, as well as the Q2 high at $11.88.
On the downside, however, a move below $6.70 and the 50-day moving average does not bode well for bulls. In that scenario, the $5.75 gap-fill level could be in play.
Top Trades for Tomorrow No. 4: Nike (NKE)
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Nike (NYSE:NKE) shares were buried on Friday following disappointing quarterly results.
Shares broke the previous post-earnings low of $150.48 and are seeing a second day of selling here on Monday. However, I think the stock could be setting up for a great buy-the-dip opportunity, based on support and risk/reward. I know the quarter wasn’t great and either was guidance, but this is a trade — not a full position investment.
In the $145 to $147 zone, not only does Nike find a huge area of prior resistance, but it also finds the 200-day moving average. I would be a buyer on a dip into this area — aggressive buyers could justify a long position now — and would use a break or close below the 50-week moving average as my stop-loss.
More conservative bulls may consider a tighter stop-loss, such as a close or sustained break below $145.
On the upside, though, keep an eye on $150.50. A move above that level could fuel a further push to the upside, even if it’s only temporary.
On the date of publication, Bret Kenwell did not have (either directly or indirectly) any positions in the securities mentioned in this article. 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.
