We’re on day three of notable selling pressure ever since the S&P 500 failed at a key resistance area. With that in mind, we now turn our attention to a few top stock trades for this week.
Top Stock Trades for Tomorrow No. 1: Apple (AAPL)
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I’m a bull at heart and I never like betting against Apple (NASDAQ:AAPL), but it was hard to ignore the potential for a weekly-down rotation this week at roughly $162.
Aside from the potential weekly-down rotation, Apple had three really interesting weekly closes in a row. That’s what originally brought it to my attention.
Now moving lower, I’m keeping my eye on the $153 to $155 zone. There it finds (in order) the 10-month moving average, the January low at $154.70 and the 200-day moving average. Last month’s low comes into play at $152.
The only caveat here is March 8, when Apple hosts one of its product events. That creates a somewhat binary scenario, which could propel the stock higher or sink it down into this target zone.
On the upside, the 10-day moving average is the first target should shares of AAPL stock reclaim $162. Above that, and the 21-day is next. Both measures have been active resistance as of late.
Top Stock Trades for Tomorrow No. 2: Amazon (AMZN)
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Amazon (NASDAQ:AMZN) enjoyed a powerful post-earnings rally, but those gains have faded since the report on Feb. 3. On a closing basis, Amazon was never able to reclaim the declining 10-week moving average.
Now shares are breaking back below prior range support near $2,900 and are coming into the 2022 lows near $2,700. If these lows break and aren’t reclaimed, it could put the $2,500 area in play.
On the plus side, $2,500 is a very interesting zone. Not only was it the breakout level from the second quarter of 2020, but just below it, Amazon has the 200-week and 50-month moving averages, as well as the monthly VWAP measure.
The 161.8% downside extension comes into play a little lower at $2,350.
If shares bounce, though, $2,900 is on watch, followed by $3,000 and the declining 10-week moving average.
Top Stock Trades for Tomorrow No. 3: American Airlines (AAL)
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Last week we looked at United Airlines (NASDAQ:UAL), noting that the downside break was a bad development for the bulls. Monday’s action only reiterated that stance. Rising oil prices and geopolitical turmoil is not a good situation for the airlines.
That action can also be seen in American Airlines (NASDAQ:AAL). Shares broke below last month’s low of $14.91 on Friday and fell even lower on Monday.
On the plus side, the stock filled the gap down at $13.58, but it has kept on declining since. Shares now face the question of, is $11 next?
If American Airlines stock continues to decline, then $11 very well could be next on the list. However, if it regains its footing before then, let’s see if it can reclaim $14.42 — last week’s low — then $14.91.
Top Trades for Tomorrow No. 4: Dick’s Sporting Goods (DKS)
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Dick’s Sporting Goods (NYSE:DKS) will report earnings tomorrow morning, and it’s hoping to build off some of the momentum that other retailers have garnered over the last few days as they’ve reported.
Shares were lower on Monday. But on the plus side, the charts are pretty clear. After riding the 200-day as support for many months, Dick’s was rejected by this level last week.
Therefore, the first upside level to watch tomorrow is $113.32. Above it sends Dick’s above last week’s high and the 200-day, opening up the next resistance zone near $120.
On the downside, though, shares are already trading into the $100 area. If it fails, the $92 level may be in the cards. That was a big breakout level then support zone in 2021, while the February low comes into play at $92.31.
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.
