We had a little bit of everything on Friday: It was the last day of the third quarter, an SEC lawsuit for a high-profile company and earnings. So let’s not waste time and dive right into our top stock trades.
Tesla
After the close on Thursday, the SEC announced that it will sue Tesla (NASDAQ:TSLA) chairman and CEO Elon Musk. According to reports, the SEC and Musk were close to a no-plea settlement but Musk turned it down at the last minute. Now he risks being barred as an officer or director of a public company if found guilty.
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This level has been a key support area for three years, so losing this mark would be a bad development for bulls. Going forward, see how TSLA handles the $250 to $255 level and the 200-week moving average.
Below both marks and bulls may want to step to the sidelines until TSLA stock improves.
Some food for thought:
TSLA Stock: The Biggest Opportunities Come From the Loudest Headlines
Buy Tesla Stock? Only If You’re Nuts Like Musk
BlackBerry
After a huge move to $12, BlackBerry (NYSE:BB) stock backed off its earnings-fueled rally on Friday. An 11.5% gain is nothing to scoff at, although it’s well off the 17% gains it sported near its highs.
To go long BB stock, let’s keep it simple. Over the 200-day moving and downtrend resistance and investors can be long. Below and BB may need to reset before attempting another rally.
Worth noting is that $12 is the 50% retracement mark from the 2018 highs to the 2018 lows. Still, the close was not an impressive show for bulls.
It was reported on Friday that Facebook (NASDAQ:FB) was hacked and may have compromised some 50 million accounts. Not the end of the world vs. the size of its user base, but not good timing in terms of the rest of the news around Facebook.
Falling below that $167-ish area was discouraging and a close below the 20-day moving average is equally disappointing. Will the $160s hold up as support?
We’ll find out unless FB can accelerate higher. Short-term bulls can buy on a breakout over $167 and target the $175 gap-fill and 50-day moving average. If the $160 level fails as support, look for support near the year’s lows around $150.
Snap
Like General Electric (NYSE:GE) I find no reason to buy Snap (NYSE:SNAP) at this point. On Friday, shares broke to even more new lows, as the losses continue to accelerate.
Plain and simple, the fundamentals at Snap just aren’t that good.
While I agree that Snap is oversold and will eventually “snap” back, it couldn’t even rally on news it’s collaborating with Amazon (NASDAQ:AMZN). That shows me that sentiment is terrible right now and buying is equivalent to catching a falling knife.
On a rebound, see how Snap handles $9, a former level of support. At the very least, shares need to get above the 20-day moving average and steep downtrend resistance (blue line) before bulls should consider a long position.
Intel
Advanced Micro Devices (NASDAQ:AMD) fell on reports of Intel (NASDAQ:INTC) and its chips, while Nvidia (NASDAQ:NVDA) got a big boost after Evercore analysts assigned a $400 price target.
While AMD and NVDA are interesting, let’s focus on Intel. This stock has been under plenty of pressure, and while the 3% pop on Friday was encouraging, it’s left bulls in a precarious position.
Over $46 to $46.50 is good, but the rejection from the 50-day is troubling. Particularly as the 50-day has been stiff resistance for several months and is riding right alongside downtrend resistance (blue line).
Bulls aren’t completely out of luck, though. A close over this area — call it $48 — and INTC stock could be a good long. Otherwise, it may just be a rally into resistance and Intel could fall back into the bottom of the channel. I would love a deep pullback down to $42, but I don’t know that we’ll get there.
Bret Kenwell is the manager and author of Future Blue Chips and is on Twitter @BretKenwell. As of this writing, Bret Kenwell is long NVDA.
