After a solid bounce on Thursday and Friday, equities took a day off on Monday with the major indices posting a slight decline. Growth stocks remain in question at this point, but crypto and commodities were the real focus of the day. With all of that in mind, let’s look at a few top stock trades.
Top Stock Trades for Tomorrow No. 1: Ethereum (ETH-USD)
After topping $4,000, Ethereum (CCC:ETH-USD) is finally showing some cracks and turning lower. On Sunday, prices wobbled but found support from the 21-day moving average in a volatile session.
On Monday, though, Ethereum couldn’t dodge the selling pressure, breaking below $3,500 and the 21-day moving average.
Firming up near $3,000 and bulls are looking for more buyers. On a rebound, I want to see ETH clear $3,000, then the 21-day and 10-day moving averages.
On the downside, a break of $3,000 puts the $2,500 breakout spot in play, as well as the 10-week and 50-day moving averages. This area should be a solid bounce zone if more downside plays out.
On the very high upside, however, it’s clear that $4,100 to $4,200 is resistance. Above that, and Ethereum can potentially break out to new highs.
Top Stock Trades for Tomorrow No. 2: Gold ETF (GLD)
Gold and precious metals are trading much better on the long side and that’s clear as we look at the SPDR Gold Trust ETF (NYSEARCA:GLD).
The GLD is hitting its highest levels since early February, as it pushes through the 50-week moving average. It closed near its highs last week, but below this key moving average. Pushing above it now gives bulls hope that more upside is on the way.
Let’s be sure that the GLD closes above the 50-week moving average this week, though.
$175 has been a bit of a tricky spot for the ETF this year. If it can push above it, it technically puts the $183 level in play, which has been stiff resistance.
On a break back below the 50-week moving average, watch to see how the stock does with its 10-week and 21-week moving averages.
Top Stock Trades for Tomorrow No. 3: Home Depot (HD)
Home Depot (NYSE:HD) is scheduled to report earnings before the open on Tuesday. The stock has been on fire, but cooled off last week.
If we didn’t have to tango with earnings, this would be a great trading setup ahead of the print, as shares bounce nicely off the 10-week moving average. That’s a nice reset after a strong rally.
Now what though?
On a bearish reaction, I don’t know that we’d see an 8% to 9% decline, but if we do, look for support from the prior breakout zone at $292 and the 21-week moving average.
On the upside, I’m looking for a move back over $325, that potentially puts $340 back in play.
Top Trades for Tomorrow No. 4: Tesla (TSLA)
I know I just looked at Tesla (NASDAQ:TSLA) last week, but this name remains on too many radars to ignore.
The stock continues to be rejected from the $591 level, as well as the 200-day moving average. If it takes out last week’s low (at $559.65), then we may see a test of the 50-week moving average and the March low near $540.
On a break of this area, a retest of the $500 breakout level may be in play.
On the upside, we need to see a push above $591 and the 200-day moving average. Above puts the 50-day and 10-week moving averages 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.
Bret Kenwell is the manager and author of a free newsletter at Future Blue Chips and is on Twitter @BretKenwell.