After an explosive couple of days, the bulls have been struggling for traction. As long as the damage is contained, a little rest is a good thing for the market. With that in mind, here’s how a few top stock trades are shaping up going into the second half of this week.
Top Stock Trades for Tomorrow No. 1: Advanced Micro Devices (AMD)
Advanced Micro Devices (NASDAQ:AMD) really has my attention here. On Friday, the stock burst back above the key $100 level, while clearing the 50-day moving average in the process. AMD stock is looking much, much better on the long side — provided it can hold above these two marks.
On Tuesday, the last day of the month, it put in the May high at $104.55. If shares can hold above $100 and the 50-day moving average and go monthly-up over $104.55, we could be looking at a larger push higher.
Specifically, I’d be looking at the $109 to $110 area, which is where the 61.8% retracement comes into play. Above that opens the door to the 200-day, then potentially the $125 level.
On the downside, a break of $100, as well as the 10-day and 50-day moving averages, could put the mid-$90s in play, at a minimum.
That’s not my interest, though. I’m watching for the monthly rotation.
Top Stock Trades for Tomorrow No. 2: GameStop (GME)
GameStop (NYSE:GME) will report earnings tonight and this one has been a big mover lately. Remember, it’s also not a stock that most traders should dabble with given its wide trading ranges.
The stock has given up about half of its recent gains as it dips back toward the 10-day. If we get a bearish post-earnings reaction, first see how it handles the 10-day. If it fails, $100 could be on the table.
Below $100 and things get interesting, as it puts $78 to $80 in play. That’s been a key support area all year long.
On the upside, the main area I’m watching is $150 to $153. That’s where GameStop finds the 200-day and the 61.8% retracement. Above $159 and shares can really start to fly.
Top Stock Trades for Tomorrow No. 3: HP Inc. (HPQ)
HP Inc. (NYSE:HPQ) just keeps on delivering. Looking at the chart here, you’d hardly know the Nasdaq is in a bear market.
The stock gapped higher in November and has been range-bound between $33 and $40 since. Now rallying on earnings, bulls want to see how it finishes the session. If it can close above $40 now — and ideally, this week — then it increases the odds of a breakout.
On the upside, keep an eye on $41.47, the 2022 high. If HPQ stock can clear $42.11 — the 161.8% extension from the 2021 range — then we could be looking at a larger push into the $45 to $46.50 region.
Below $39 and the 50-day is likely on the table.
Top Trades for Tomorrow No. 4: Utilities Select Sector SPDR Fund (XLU)
The Utilities Select Sector SPDR Fund (NYSEARCA:XLU) has been trading better lately and investors are in a buy-the-dip mood as it tested into the 10-day and 50-day moving averages on Wednesday.
If the XLU can clear last week’s high at $75.37, then the highs up near $77 are back in play.
On the downside, a break of Wednesday’s low could usher in a test of the 21-day moving average and the $72 level. Below that puts $70 and the 200-day in play.
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.