Stocks were mixed on Friday on one of four annual quad-witch expiration sessions. With that in mind, here’s a look at a few top stock trades we’re watching for next week.
Top Stock Trades for Monday No. 1: AMC Entertainment (AMC)
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AMC Entertainment (NYSE:AMC) soared on the day, up more than 19%. Friday marks AMC stock’s third gain in the past four days.
Furthermore, we can’t ignore the stock’s strong reversal on Tuesday. For aggressive bulls, that was a chance to get long with a measured risk down at the new low.
It also came right after a near-test of the $20.36 level, the high from January.
The current rally is sending AMC stock up through the summer low at $28.91, as well as the 50-week moving average and weekly VWAP measure. Those are all notable levels for the stock to reclaim.
On the upside, I want to see if AMC can take out the 200-day moving average, then $34. Above $34 and the 50-day moving average is possible.
On the downside, however, bulls need AMC to hold the main levels it just reclaimed: $28.90, the 50-week moving average and the weekly VWAP measure.
Top Stock Trades for Monday No. 2: General Motors (GM)
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Shares of General Motors (NYSE:GM) dipped on Friday and broke below the 200-day moving average as a result.
Even before Friday’s drop, this week’s action was poor. Shares broke below the 50-day moving average and uptrend support (blue line). However, attempts to reclaim these measures failed.
On the downside, $53.60 and the 10-month moving average should be on investors’ radar on a further dip.
On the upside, though, let’s see if GM stock can reclaim the 200-day. Above it puts the gap-fill in play at $58, along with the 10-day moving average.
Top Stock Trades for Monday No. 3: AbbVie (ABBV)
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AbbVie (NYSE:ABBV) stock has been on fire and a real relative strength leader amid the market chop. The stock is down slightly on the day but has rallied in the previous 12 sessions.
Typically I’d like to wait for a dip to the rising 8-day or 10-day moving average, but the trend in this one is so strong. Aggressive traders may consider a long position on a dip to the 10-unit moving average on the four-hour chart (shown above).
More conservative traders may wait for a dip to the 10-day moving average if they’d rather.
Either way, sniffing out these relative strength leaders — like we pointed out with Procter & Gamble (NYSE:PG) the other day — is a good idea amid market turmoil.
Top Trades for Monday No. 4: Starbucks (SBUX)
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Starbucks (NASDAQ:SBUX) had been trading incredibly well but was struggling with last month’s high near $117.
Just like that, bulls went from a strong weekly-up rotation with shares over all of the major moving averages, to flirting with this month’s low and below all of the major daily moving averages.
Let’s see if Starbucks can hold up over $108.50. If it can, a move back over $110-plus is needed, putting the 50-day moving average in play.
On the downside, however, a break of Friday’s low that isn’t reclaimed could put the late-October low on the table near $104, followed by $100.
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.
