Wednesday was a really nice rally for the bulls on strong upside volume. But they found a way to jam this one down and really pull the rug out from under the bulls’ feet. At market close, the New York Stock Exchange experienced a 95% down day on Thursdsay. A second 90% downside day would hurt, but could get us closer to an intermediate-term low. With that in mind, let’s look at a few top stock trades, starting with the S&P 500.
Top Stock Trades for Tomorrow No. 1: S&P 500 (SPY)
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On Wednesday, the SPDR S&P 500 ETF (NYSEARCA:SPY) closed above the 10-day moving average for the first time since April 20. That didn’t last long though with Thursday’s plunge.
Now we’re sitting on last week’s low and prior 2022 support near $410. If it fails, it opens the door to this week’s low near $405, followed by the gap-fill level near $400.
On the upside, I’d really like to hold this area as support and reclaim the 10-day. If it can do that, the SPY could technically put last week’s high and this week’s high in play near $429.50. Above that and the rally can continue.
Top Stock Trades for Tomorrow No. 2: Ethereum (ETH-USD)
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Cryptocurrency traded well on Wednesday, but like stocks, they got hit hard on Thursday. I laid out Bitcoin (BTC-USD) earlier in the day, so let’s take a look at Ethereum (ETH-USD).
Ethereum is breaking below channel support, as it clings to the April low near $2,720. I know there are some uptrend lines and such to consider, but a break of channel support and the April low would be too overwhelming to me, particularly if Ethereum closes below the latter.
That would have me watching for a test of the $2,500 level, potentially followed by the 2022 low down near $2,150.
On the upside, Ethereum could run back to $3,000 and the 50-day if it can reclaim channel support. Above the 50-day really opens things up, putting the 200-day and $3,500 in play.
Top Stock Trades for Tomorrow No. 3: Nio (NIO)
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Nio (NYSE:NIO) got smoked on the day, down more than 15% and filling the gap from March at $15.35. If it can’t reclaim this level, then investors need to understand that more downside could be in play.
Specifically, I believe the 2022 low would be vulnerable, down near $13. If that level breaks and isn’t reclaimed, then another gap-fill could be in play, with this one all the way down at $9.40.
On the upside, watch for Nio to reclaim $15.35. Above that puts the 10-day in play, followed by the 50-day.
Top Trades for Tomorrow No. 4: Advanced Micro Devices (AMD)
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Advanced Micro Devices (NASDAQ:AMD) ripped higher on earnings yesterday but stalled right at the prior support zone in the $99 to $100 zone. Reclaiming this level would be huge for the bulls.
While AMD stock faded a bit on Thursday, the plus side is that it’s holding the 10-day and 21-day moving averages.
If it can continue to do so, $100 remains on the table. Above $100 would technically put the 50-day in play, but I would have my eyes on the $112 to $117 area, where we find several larger timeframe measures like the 50-week and 200-day moving averages and the weekly VWAP measure.
If AMD stock breaks the 10-day and 21-day and can’t reclaim them, then the $85 area is back on the table.
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.
