The bulls have been in control for nearly two full weeks. Let’s look at a few top stock trades as momentum emerges in tech, crypto and cannabis.
Top Stock Trades for Tomorrow No. 1: Ethereum
Ethereum (ETH-USD) and other cryptocurrencies are really gaining some attention today.
Ether was putting in quite the wedge, dating all the way back to January. Its series of higher lows and lower highs (defined with blue lines on the chart) continued to compress Ethereum’s price.
Quietly up in 10 of the last 11 sessions, Ethereum is rotating over this month’s prior high near $3,050. While it may seem obvious from the chart, the next area I’m watching is $3,275 to $3,325.
There we (approximately) find the February high and the flash crash low, respectively. If Ether can clear those marks, then the 21-week and 200-day moving averages are my next target.
On the downside, we don’t want to see this break below the 10-day. That puts Ethereum back below wedge resistance and puts the 50-day in play. Below all of its short-term moving averages and $2,500 could be back in play.
Top Stock Trades for Tomorrow No. 2: Oil
Some investors may prefer to trade oil via the United States Oil Fund (NYSEARCA:USO), and that’s just fine. For other traders though, I will simply use the charts for crude oil futures (CL) and allow others to extrapolate that to the QM contract and USO.
This morning when crude was running, I pointed out the profit-taking zone in the $115 to $116 area. Not only was this a previous support/resistance zone, but it’s also where the 61.8% retracement came into play.
Specifically, I said, “This is a major trim zone for longs.”
Now I want to see where support comes into play. If bulls remain in control, it will be the 10-day and 21-day moving averages. If not, we could see a further break down to the 50-day moving average and this month’s lows near $95.
Top Stock Trades for Tomorrow No. 3: Nvidia
Man, has Nvidia (NASDAQ:NVDA) been a great trade or what? We talked about it last week and then we were able to navigate Advanced Micro Devices (NASDAQ:AMD) because of it as well.
Investors should be trimming into today’s move, though. While powerful, stocks are still vulnerable to painful and blindsided moves. We’re one headline away from things falling apart… again.
So I would book some gains here on this Nvidia trade. Remaining longs can look for $293 next — the 61.8% retracement — then a move up toward $300.
On the downside, a move below $269 could put the 10-day in play.
Top Trades for Tomorrow No. 4: Canopy Growth
Cannabis stocks are grabbing investors’ attention, and when that’s the case, Canopy Growth (NASDAQ:CGC) is the first stock I usually look at.
Unlike on Wednesday, Thursday’s price action looks like we will get a close above the 50-day and daily VWAP measure for the first time since mid-February. If that’s the case and Canopy can continue higher, investors must keep their focus on the 21-week moving average and the $9.50 to $9.60 area.
The former has been resistance before, while the latter comes into play near last month’s high.
On the downside, be cautious on a break below $6.80 and the 21-day. That could very well put the 2022 lows back in play.
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