The market continues to give us what we want, which was a “sell the rumor, buy the news” reaction to the Fed’s first rate hike since 2018. As the market continues to hold up now after the event, let’s look at a few top stock trades for Friday.
Top Stock Trades for Tomorrow No. 1: Energy Stocks (XLE)
Oil prices pulled back hard, but are now starting to climb again. And that’s got the Energy Select SPDR ETF (NYSEARCA:XLE) on watch.
Notice the “ABC” correction we have here on the daily chart. It was a near-perfect correction down to the 21-day moving average and the 161.8% downside extension. From there, it gave us a doji candle, which left me looking for a rotation either through the high (to get long) or through the low (to get short).
Instead, we got an inside day, tightening the range and giving us the same setup coming into Thursday.
It ended up being an inside-and-up rotation over $72.75. That opened the door up to the $73.55 gap-fill and the declining 10-day. There now, I would trim some of the trade and look for $75 next — which is roughly the 61.8% retracement.
On the downside, though, a break of the 21-day puts $70.75 back in play.
Top Stock Trades for Tomorrow No. 2: PagerDuty (PD)
PagerDuty (NYSE:PD) is such a great company and it doesn’t get the recognition that it deserves, in my opinion.
Thursday’s post-earnings rally has PagerDuty stock trading through a key area. Above $31.25 flings the stock over the 21-day and 50-day moving averages, the daily VWAP measure and the 61.8% retracement of the current range.
If it continues higher from here, the $35 to $35.50 area is in play next. Above that puts $38 on the table, where it finds the 200-day and 50-week moving averages, as well as the weekly VWAP measure.
Below $31 puts the post-earnings low in play at $29.04, followed by the gap-fill at $27.64.
Top Stock Trades for Tomorrow No. 3: Amazon (AMZN)
Amazon (NASDAQ:AMZN) stock has wavered a bit — and what hasn’t, given the volatility — but has largely seen a nice rally since announcing a 20-for-1 stock split earlier this month. Man, it’s about time.
Up about 2.7% on Thursday, Amazon stock is now up more than 10% over the last three days. The move was enough to send the stock through the 50-day moving average, which had been resistance.
From here, it faces resistance around $3,150 to $3,180. I wouldn’t be surprised to see this zone act as resistance. If it does, then bulls want to see the 50-day act as support.
However, if it can push through $3,200, it opens up more upside, potentially toward the 200-day.
Top Trades for Tomorrow No. 4: Tesla (TSLA)
The 21-day moving average has been active resistance for Tesla (NASDAQ:TSLA) for more than a month now, while it’s been below the measure for two months.
That is not the case on Thursday, with shares powering through this mark, along with the 200-day. It’s running right into the daily VWAP measure now. If it’s resistance, I want to see the 200-day and especially the 21-day moving average act as support.
If Tesla can power through the daily VWAP measure, then the declining 50-day and channel resistance are on deck.
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.