Stocks were hit overnight, finding their footing near the open but coming under more selling pressure thanks to the escalating geopolitical tensions in Eastern Europe. Here are a few top stock trades to focus on going into the week.
Top Stock Trades for Tomorrow No. 1: Sea Ltd.
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Sea Ltd. (NYSE:SE) is getting demolished on the day, down almost 20% during Monday’s trading session. It’s hard to believe given how good of a stock this was before, but here we are.
With today’s big gap down, SE stock is trying to find its footing. If it can, look to see how it handles Monday’s high at $139.70.
Above that level and this stock can begin to fill today’s gap and potentially trade up to the 10-day and 21-day moving averages. Above that and it can completely fill this gap up at $155.76.
On the downside, keep an eye on last month’s low at $119.41. That level comes into play near the 200-week moving average and it’s possible we get some kind of undercut of this level and a reversal. Stay open-minded with Sea.
Top Stock Trades for Tomorrow No. 2: AbbVie
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AbbVie (NYSE:ABBV) is a name I flagged this morning, as it has been one of the only strong stocks in the market lately. It didn’t live up to that observation in the opening 90 minutes of trading on Monday, but it’s been trading well since it found its footing.
The stock bounced nicely from the 10-day moving average and last week’s low. Today’s low now becomes our stop-loss point on the trade. A break of that likely puts the $138 level on deck, as well as the 21-day moving average.
From here, I’m looking for the $143.50 to $144 area on the upside, followed by the recent high at $144.42. New highs open the door to the 261.8% extension near $147.25.
Top Stock Trades for Tomorrow No. 3: Toronto-Dominion Bank
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Another stock we’ve had tremendous success with lately? Toronto-Dominion Bank (NYSE:TD).
This stock gave us a powerful weekly-up rotation two weeks ago and that paved the way for a move to new highs. Those highs were greeted by profit-takers — naturally — so we were waiting for a dip.
That dip presented itself this morning as TD tested a number of key areas, including the 10-day moving average, the $83.08 breakout area and last week’s low at $83.03.
On the upside, I would like to see a move to the $84.20 to the $84.50 area. Above that could put $85.50 to $86 in play. I know that’s a fickle range, but that’s what we’re trading right now in a tough environment.
On the downside, a break of today’s low deals a blow to the bulls’ case.
Top Trades for Tomorrow No. 4: Avis Budget Group
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Last but not least we have Avis Budget (NASDAQ:CAR).
I don’t like trading these setups much — I prefer the TD and ABBV’s of the world — but CAR has investors’ attention with its giant, volatile moves.
If CAR can going weekly-up over $203.50, then it could create a powerful squeeze to the upside. That could put the $235 to $240 area in play, which is the 50% retracement of the recent low to the $320 area.
On the flip side, a weekly-down rotation below $177 could put last month’s low in play at $157.28, along with the 200-day moving average.
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.
