After a slow and somewhat painful Monday, the stock markets burst higher on Tuesday, rallying on impressive upside breadth. With that in mind, let’s look at a few top stock trades as we push through the holiday-shortened trading week.
Top Stock Trades for Tomorrow No. 1: Cardano (ADA-USD)
The cryptocurrency has not enjoyed a massive run lately, and in fact, Cardano has continued to slide lower as it underperforms its peers.
Now clinging to the $1.20 level, Cardano bulls are hoping this level holds as support. As we all know though, “hope” is not a strategy. Furthermore, the trend is not the bulls’ friend, as Cardano continues to make a series of lower highs.
A break of $1.20 that isn’t quickly reclaimed could put the $1 level in play. So while cryptocurrencies ebb and flow as the talk of Wall Street, keep this technical alignment in mind.
Top Stock Trades for Tomorrow No. 2: The Ark Innovation Fund (ARKK)
We have gone back and forth on the Ark Innovation Fund (NYSEARCA:ARKK) a few times over the last few weeks. The fund is clearly trying to find its footing to call a bottom, but the selling in growth stocks has been relentless.
On Monday, I was looking for a potential weekly-up rotation over $97.50, following an inside week last week. Then on Monday, ARKK gave bulls and inside day — opening up the potential for a daily-up rotation over the area near $96.50.
It didn’t matter which you chose, with ARKK clearing both levels today.
My preference laid with the first rotation — the weekly-up — because it’s more significant in my opinion and it would put ARKK back above the bear-market low from May.
From here, let’s see if we can get a tag of $100 and the 21-day moving average. Above these measures, and the $103 to $104 area could be on the table. Above that puts the 50-day in play.
However, a break of this week’s low flashes some rather bright caution signs, in my view.
Top Stock Trades for Tomorrow No. 3: Pfizer (PFE)
Pfizer (NYSE:PFE) is another name that has been on our go-to list, given the robust rotation we had last week and the subsequent rally to new highs.
This morning it pulled back to its 10-day moving average, which set up the dip-buy opportunity for bulls who were prepared. Bouncing hard off this level now, let’s see if shares can get back above $60.
North of $60 and the highs are back in play at $61.71, followed by $62.75 and then potentially $69 to $70 down the road.
Top Trades for Tomorrow No. 4: Rite Aid (RAD)
Rite Aid (NYSE:RAD) has been a dog for most of the year, as it continues to put in a series of lower highs. But the stock may try to end that trend soon.
Shares are erupting over the 10-day, 21-day and 50-day moving averages on the day, as well as downtrend resistance (blue line). However, the stock is running right into the 10-month moving average and the monthly VWAP measure.
If it can clear this area, the November high is on the table at $15.65. If we get a monthly-up rotation in Rite Aid (and thus, ending the series of lower highs), it could open the door up to $16.50 and the 200-day moving average.
On the downside, though, let’s see if the 50-day moving average holds as support until some of Rite Aid’s shorter-term moving averages can catch up.
On the date of publication, Bret Kenwell held a long position in PFE. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.