Bulls are dying for a breather as the S&P 500 is a day away from notching its sixth straight weekly decline. On Thursday, we saw some spurts of life, with growth stocks squeezing higher in the morning session. With that in mind, let’s look at a few top trades, starting with growth.
Top Stock Trades for Tomorrow No. 1: Arkk Innovation Fund (ARKK)
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The Arkk Innovation Fund (NYSEARCA:ARKK) opened lower on the day but was one of the first major exchange-traded funds (ETFs) to flip positive in the morning. It ultimately rallied almost 10% at the session higher, before fading back down to a more reasonable level.
Interestingly ARKK was up over 5.5% on the day, while the Nasdaq and S&P 500 finished lower.
ARKK is trading down into the key $35 to $50 zone we mentioned not too long ago. It traded in the $33 to $35 range twice in the last few years and both were major lows: Q4 2018 and the March 2020 Covid lows.
Can it act as the low again? I would love to see this level hold and get a robust rebound back to the $50 area and the declining 10-week moving average. It would be a huge move, but not when you look back over the past few months of price action.
Top Stock Trades for Tomorrow No. 2: General Motors (GM)
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General Motors (NYSE:GM) and Ford (NYSE:F) were both knocked down to one-year lows due to some analyst calls on Thursday.
When I look at GM, one very interesting level stands out: The 61.8% retracement. That’s as we measure from the 2022 high down to the March 2020 Covid low.
If it doesn’t hold, I have to think the low-$30s are in play, which have been key in the past. Keep in mind, GM’s IPO price was $33.
On a bounce, though, I’m looking for a move back to $40. Active resistance has been the 10-week moving average.
Top Stock Trades for Tomorrow No. 3: Ford (F)
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You can see how the $12.50 level was support for Ford (NYSE:F) in mid-2021. The question is, will it be support again?
If it is, then great. We could potentially see a rebound all the way back up to the $15 area — where the stock broke down from — as well as the declining 10-week moving average. Like GM, this measure has been active resistance.
Should Ford see more selling pressure instead, then it opens the door to a very key area in the $10 to $11 zone. Not only was this a big breakout level, but it’s also where Ford finds the 200-week and 200-month moving averages.
Top Trades for Tomorrow No. 4: Lululemon Athletica (LULU)
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Last but not least, we have Lululemon Athletica (NASDAQ:LULU). I have been keeping a close eye on this name, as it is getting hit hard but is fresh off solid earnings and there is clear demand for its products.
Each dip to the $290 area has been bought, a trend that dates all the way back the second quarter of 2020.
Should the selling continue, it opens the door down to the $270 area, where Lululemon stock finds the rising 200-week moving average. These are the two downside zones to be aware off.
Back over $300 puts this week’s high in play at $313, then a potential move all the way up to the $330 to $335 area, where Lululemon stock finds the declining 10-week and 21-week moving averages.
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.
