Stocks put together another strong rebound on Thursday, as the S&P 500 hurdled a few key short-term levels. Can the rally continue? Let’s look at a few top stock trades going into Friday.
Top Stock Trades for Tomorrow #1: A. O. Smith
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A. O. Smith (NYSE:AOS) is actually a dividend stud, not that you’d suspect it based on Thursday’s action. Shares are down more than 7% after a negative report about the company’s exposure to China.
Yikes. While the stock has rebounded nicely from the session lows, it’s still down big. On Wednesday, the stock was teetering on $48 support, a key level that also happened to be near the stock’s 200-week moving average.
Thursday’s plunge causes major concerns on the chart now, with a potential drop down to $41 in the cards. On a rebound, see how it handles $48.
Top Stock Trades for Tomorrow #2: Skyworks Solutions
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Skyworks Solutions (NASDAQ:SWKS) was also hit hard on the day, down about 5.5%.
The real tell came on Wednesday though, with this week’s action painting quite the picture. On Monday, shares gapped down from $82.50, closing below the key $80 level and breaking below the 200-week moving average. On Wednesday it tried to push back through the 200-day, but was rejected. That was our sign that SWKS was in trouble.
Below this week’s low and SWKS doesn’t look too healthy. On the plus side, the stock filled its February gap, but it’s still searching for support. A close above $75 improves the technical situation a bit and adds to the probability of a 200-day retest. Below $75 though and $70 is on the table.
Top Stock Trades for Tomorrow #3: Qorvo
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Below Thursday’s low and the 200-day moving average and $64.50 level are in sight. Below $64 and QRVO will be flirting with a fall into no man’s land. Should the stock bounce from current levels first, watch to see how it does with the 20-day and 50-day moving averages.
Top Stock Trades for Tomorrow #4: The Trade Desk
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The Trade Desk (NASDAQ:TTD) is a name we love for the long term, but it’s been volatile in the short term. Shares fell to $173.60 after earnings, falling about 25% in a matter of days. A market rebound coupled with the CEO’s appearance on Jim Cramer’s “Mad Money” show was enough to ignite the stock back over $200.
Not bad, but now it’s running into trouble.
Shares ran to $210 on Thursday. Not only was this a prior resistance zone, but the 50-day and 20-day moving averages converged at $204 and helped to act as resistance.
From here, a retest of TTD’s range lows near $180 wouldn’t be a surprise, particularly if we get some selling pressure in the broader market. A rally over $210 could spring TTD back up to $230 or more.
Top Stock Trades for Tomorrow #5: Pinterest
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Shares of Pinterest (NYSE:PINS) are ripping higher on Thursday, up more than 6% — and still climbing! There’s just one issue and that’s earnings, which are due up after the close.
Given the volatility over the past few weeks, PINS has held up pretty well. Shares were mostly bouncing between $28 and $30, with the exception of a break down to $26.39. However, the stock pushed through short-term downtrend resistance (blue line) and climbed above $30 range resistance.
It will be interesting to see how it trades from here. Will the report be like Lyft (NASDAQ:LYFT) and sack the newly public company or will it be enough to propel it back to its highs near $35?
The best case scenario for bulls? A report that highlights a solid underlying business and price action that maintains support. Be it at prior resistance near $30, the 8-day moving average at $29 or range support at $28.
Bret Kenwell is the manager and author of Future Blue Chips and is on Twitter @BretKenwell. As of this writing, Bret Kenwell was long TTD and PINS.
