The Federal Reserve remains “patient” and the stock market remains up — for now. Investors are looking for a reason to book some profits into possible resistance, but can’t decide if the Fed report is reason enough to do it. Other than that, we have a few top stock trades to watch for Thursday.
CVS Health (CVS)
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Despite beating on earnings estimates, shares of CVS Health (NYSE:CVS) are lower after management’s less-than-thrilling outlook.
Fortunately, CVS’s charts are relatively straightforward. Sellers line up near $80 and buyers get in line in the low $60s. So far, the low for this year is near $62.50. There’s a bit of trend support nearby as well (blue line) at $63.
However, should $62 give way, We could see that $58 to $60 level CVS stock traded at last April. I’m not a dip-buyer in CVS, but these are the levels for bulls to keep in mind.
Southwest Airlines (LUV)
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Higher-than-usual grounding of its fleet is causing concern for investors, who sold Southwest Airlines (NYSE:LUV) lower by 5% on Wednesday.
Wednesday’s lows hit the 50% retracement from Southwest’s 52-week range. In short, it’s not easy to define its trading setup; shares are smack-dab in the middle of its annual range and they have no real trend to speak of. Those looking to buy will need to see it stay over the 200-day moving average. While this level hasn’t played a huge role over the past few years, it did on Wednesday.
Below, it opens the floodgates down to the 50-day moving average, a decline of more than 5.5%. Ultimately, I would rather pass on Southwest unless it gets down toward $50. Near that price, investors show it plenty of “LUV.”
Invintae (NVTA)
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Man, did Invintae (NASDAQ:NVTA) blow out the numbers or what? The company’s quarterly results were wildly impressive and Wall Street is rewarding investors on Wednesday, up almost 14% after an already huge rally.
At the beginning of the month, I noted the stock’s breakout over $15 and said it could run to $18 if the bulls maintain momentum. $3.75 per share later and the stock is logging new highs. It’s hard to chase here, but the story is great and if we get a pullback, bulls may consider buying this one.
Will we see a push toward $20 before that happens? Maybe. If so, look for $18 to be support on a pullback. If we pullback first, look for the breakout over $16.75 to $17 to act as support.
Henry Schein (HSIC)
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Shares of Henry Schein (NYSE:HSIC) used to be very consistent, but that hasn’t been the case over the last few years. Despite beating earnings estimates on Wednesday, shares fell over 5% on the day.
Down near $57 to $56.50, dip buyers may find the risk/reward attractive. But this one is lagging any sort of momentum or support near current levels. Over $61 — with all three major moving averages near $60.50 — and it looks better. Otherwise, let’s wait for lower.
Baidu (BIDU)
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Chinese stocks have been on the move lately and Baidu (NASDAQ:BIDU) has been coming back to live. Honestly, nibbling right here isn’t a bad setup with investors able to pull the plug on a close below the 50-day moving average.
However, a push over the $175 level could trigger a move to $180. Should BIDU push through this mark, a rally up to $195 could ultimately be in the cards.
Bret Kenwell is the manager and author of Future Blue Chips and is on Twitter @BretKenwell. As of this writing, he was long NVTA.
