Stocks were creamed on Friday due to worries over the new Covid variant Omicron. We bounced nicely on Monday, but stocks are back under pressure on Tuesday. With that in mind, let’s look at a few top stock trades.
Top Stock Trades for Tomorrow No. 1: Ethereum (ETH-USD)
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While Bitcoin (CCC:BTC-USD) isn’t seeing the same kind of rotation today, Ethereum (CCC:ETH-USD) sure is.
In fact, Ethereum is going weekly-up over $4,555. From here, that puts the 161.8% extension and the all-time high in play up near $4,875 to $4,900.
If that does indeed come to fruition, bulls will inevitably turn their attention to the $5,000 level. A breakout over $5,000 puts the $5,500 area in play next, followed by $6,000 to $6,250 zone — where another set of upside extensions sit.
Back below $4,555, and investors will be watching the 10-day and 21-day moving averages.
Below $4,380 has the 50-day and 10-week moving averages on deck, followed by around $4,000.
Top Stock Trades for Tomorrow No. 2: Xpeng (XPEV)
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Xpeng (NYSE:XPEV) continues to trade incredibly well. And if we look at just this chart, there’s no indication that the market is experiencing any volatility.
The stock is doing a terrific job holding up over the breakout level (blue line) and the 10-day moving average. Now trying for a weekly-up rotation and a move over the 61.8% retracement, bulls are hoping to see Xpeng gain steam over $55.
If it does, that could open the door to the current 2021 high up near $60, then the 78.6% retracement at $63.41.
However, a move below the breakout level and the 10-day moving average could force XPEV stock to rest a bit.
Top Stock Trades for Tomorrow No. 3: Dollar Tree (DLTR)
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Dollar Tree (NASDAQ:DLTR) was a stock I had on my radar early this morning, as the stock was under pressure from a downgrade following a fantastic earnings reaction.
Shares are checking back to the 10-day moving average after its massive run, opening the door for aggressive dip-buyers to get long.
If we get a bounce going, $140 would be the first upside target. Above that, and $143.50 to $145 could be next, followed by the highs near $148.
On the downside, though, failure to find support could put $130 in play, followed by the 21-day moving average.
Top Trades for Tomorrow No. 4: Alibaba (BABA)
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Last but not least, we have Alibaba (NYSE:BABA), which has been an abysmal performer.
The stock is working on its fourth quarterly decline in the past five quarters, and the one quarterly gain in that stretch was a paltry 0.02% — and no, that’s not a typo!
Shares have declined in nine of the past 13 months and in the most recent month (November), we’ve seen a 22% haircut to the share price. Alibaba ended November in a monthly-down rotation, taking out the October low.
Amid the recent decline, BABA stock is now below its 2018 low at $138-and-change. If we reclaim it, it could put a reversal in play.
However, a further decline could put the $120 level on deck. With some divergence on the chart, that could set Alibaba stock up for a bounce if we get there. While it won’t always remain the case, bears remain in control at the moment.
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.
