What a day for the bulls. After a solid session on Monday, the indices left some questions as to whether bulls could harness control going into the rest of the week. That question was answered with a robust upside day on Tuesday. So, with all of that in mind, let’s look at a few top stock trades.
Top Stock Trades for Tomorrow No. 1: Apple (AAPL)
Apple (NASDAQ:AAPL) was a leader in the rally off the October lows and an anchor once volatility picked up in late November.
The stock wasn’t invincible, but the way that it held up certainly made life easier for bulls — both in sentiment and in price with its $2.8 trillion market capitalization.
Last week, shares faded from our first price objective, the $169 to $170 area. However, the stock held the prior high at $157.26 on the pullback and we now have upside follow-through to more new highs.
If Apple can clear $173, it opens the door to some longer-term price targets, like the $188 to $195 area. I don’t think it will get there in the next few days, but as long as the trend is intact, these levels are possible.
On the downside, however, I want to see Apple hold the 10-week moving average and $157 area.
Top Stock Trades for Tomorrow No. 2: Macy’s (M)
Macy’s (NYSE:M) is one of the few stocks that didn’t begin the day on Tuesday with a massive gap-up and to some degree, perhaps that is a bit of a warning sign.
But I can’t stop looking at this name as it tries to rotate over $28.15. That’s as it corrected down from the $38 level into its 10-week and 50-day moving averages.
If this stock can rotate over $28.15 and the 10-day moving average, we could see a powerful push higher.
On the downside, though, a break of Monday’s low at $26.84 would raise a red flag.
Top Stock Trades for Tomorrow No. 3: Coupa Software (COUP)
Coupa Software (NASDAQ:COUP) looked like it was doomed today, falling 12.5% in Monday’s after-hours session and 12.1% in Tuesday’s pre-market session after reporting earnings last night.
Instead of catastrophic losses, though, Coupa opened lower by just 2.25% and finished the day down just under 3%
If we look at the weekly chart, we’ll see that Coupa is resting on the 200-week moving average and the prior breakout area near $175.
Bulls who like this name can be long against this week’s low. On the upside, I want to see shares take out this week’s current high near $186. Above that puts $200 to $205 in play next.
Top Trades for Tomorrow No. 4: PagerDuty (PD)
PagerDuty (NYSE:PD) rallied nicely on the day ahead of its earnings report after the close.
This is a situation where the business is doing good, but the stock is doing terrible. In early September, shares rallied on strong results, but the rally was sold as growth stocks were out of favor.
Tuesday’s move sent the stock back over $34. The risk here is that earnings send it back below this measure, cementing this once strong support level as resistance. However, if PD stock can clear $35 and the 10-day moving average, it could put the $39 to $41 zone in play next.
The downside risk has two levels to watch: Tuesday’s gap-fill at $31.74 and last week’s low at $30.32. Below the latter puts Monday’s low back on the table at $29.15. Below that, and PD stock is in no man’s land.
On the date of publication, Bret Kenwell held a long position in PD. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.