After a strong start to the day, most stocks faded on Friday. With that in mind, let’s look at a few stock trades for Monday.
Top Stock Trades for Monday No. 1: Boeing (BA)
Boeing (NYSE:BA) caught a spark on Friday, jumping more than 12%. This move seems small, even on the daily chart, given how much this stock has jumped around over the past few months.
Either way, BA stock is well off its lows, up more than 60%. The stock reclaimed its 20-day moving average on Friday, after losing it on Thursday. Further, BA stock is breaking out over wedge resistance (blue line).
If the stock can hold up over this mark, $160 is on the table. Above $160 and a run to $185 may be in the cards.
A break back below prior wedge resistance puts the 20-day moving average and wedge support in play. If that gives way, BA stock could see $120 again. Investors have quickly gotten used to the extra volatility in this one.
Top Stock Trades for Monday No. 2: Moderna (MRNA)
Moderna (NASDAQ:MRNA) shares are surging on Friday, following the Gilead Sciences (NASDAQ:GILD) report about a potential treatment for the coronavirus.
The news sent MRNA up more than 12% on the day, as shares rocketed through $36 resistance this week. If we get a bit more upside follow through next week, $50 is possible. However, for investors who missed this move already, buying at $46-and-change likely isn’t the best risk/reward setup.
I’d love to see a pullback to $36 that holds as support. If we get that, MRNA may very well be a buy provided support holds up.
If it fails, look to see if $30 support and uptrend buoy Moderna. Below and the setup will be pretty weak for bulls. However, it may set up for a retest of the 50-week moving average. That’s been solid support since being established in December 2019.
Top Stock Trades for Tomorrow No. 3: Schlumberger (SLB)
Let’s look at a couple of earnings plays, starting with Schlumberger (NYSE:SLB). Like Boeing, SLB has been a wild mover the past few months. It’s why the stock’s 6.5% rally hardly looks like a rally on the daily chart above.
However, the levels are well defined. Starting with the upside, see if SLB can clear $16. If it can, it puts a move back up to $18 in play. I expect this level to act as stiff resistance, at least until there’s some upside traction in oil prices. Over $18 and the March high of $19.23 is on the table.
On a move lower, see if Schlumberger can hold support at $14. Below puts uptrend support (blue line) in play near $13, followed the lows near $12. If we get a retest of the latter, SLB may be worth playing for a quick bounce, particularly if it breaks the low and quickly reclaims it.
Top Trades for Tomorrow No. 4: Kansas City Southern (KSU)
Kansas City Southern (NYSE:KSU) began the day with a post-earnings pop. However, those gains faded throughout the session. The stock filled the gap up toward $145 and briefly reclaimed several key moving averages.
Unfortunately for bulls, the stock faded from $145, while failing to hold the 50-day and 200-day moving averages along the way. So what now?
On the downside, we have rising support (blue line), which is part of a rising wedge pattern. If support breaks, this pattern will confirm a bearish setup and put lower prices in play. That may put $125 to $130 on the table, and possibly lower.
On the upside, investors really need to see KSU reclaim $145.90. Doing so will put it over its post-earnings high, as well as the major moving averages it failed to hold on Friday. That will put $150 and the 100-day moving average in play.
Bret Kenwell is the manager and author of Future Blue Chips and is on Twitter @BretKenwell. As of this writing, he did not hold a position in any of the aforementioned securities.