4 Top Stock Trades for Wednesday: NVDA, DIS, GE, AAL

Stock Market

After some overnight futures drama regarding the trade deal between the U.S. and China, equities rallied hard. However, breadth wasn’t all that great. That said, let’s look at a few top stock trades for Wednesday.

Top Stock Trades for Tomorrow No. 1: Nvidia (NVDA)

Nvidia (NASDAQ:NVDA) spent the last month consolidating its gains in a sideways manner. And after such a robust rally from the March lows, this is about the best case scenario bulls could have hoped for.

Shares are now breaking out over recent resistance at $370, although the move has been slow thus far. Should NVDA continue higher, look to see if the stock can get to the 161.8% extension, which comes into play up at $399.

Bulls will also be targeting the $400 level, a nice round number.

On the downside, however, look for a break of the $370 level. If this former resistance level doesn’t act as support, a drop to the 20-day moving average may be in play, followed by the $340 to $350 area.

Top Stock Trades for Tomorrow No. 2: Disney (DIS)

Disney (NYSE:DIS) has plans to start reopening its parks in France and Japan, along with a likely return to the MLB season. However, rising numbers of the novel coronavirus may not bode well for Disney shares.

The stock is trading above its 50-day moving average, but below its 20-day. Furthermore, downtrend resistance continues to pressure shares lower in the short term (blue line).

A move over downtrend resistance and the 20-day puts the 200-day moving average in play. A break of $110, though, puts $100 back on the table.

Top Stock Trades for Tomorrow No. 3: General Electric (GE)

General Electric (NYSE:GE) isn’t too different from Disney, at least when looking at the last few weeks of action.

Caught between the 20-day moving average and the 50-day moving average, GE stock is also trapped below downtrend resistance. Unfortunately, it’s also below the 23.6% retracement.

A move below $7 puts the 50-day moving average in play. Below that, and $6 is possible. On a rally, however, look to see if GE can clear the 20-day moving average. Above it puts the $8 to $8.50 area on the table.

Above that zone, and technically the 200-day moving average is possible.

Top Stock Trades for Tomorrow No. 4: American Airlines (AAL)

American Airlines (NASDAQ:AAL) has been very volatile. That’s true over the last few days, but really, it’s been the case all month.

A few weeks ago, AAL stock erupted over the $12.50 level, rallying more than 40% in a single session. Shares ultimately ran to the 200-day moving average, topping out at this mark as failed to continue higher.

Since then, the stock has put in a series of lower highs and on Tuesday, gapped below the 20-day moving average.

From here, the setup is simple. I either want to see a further correction down to $12.50 and the 50-day moving average, or I need to see a breakout over the 20-day moving average and downtrend resistance. Clearing the 38.2% retracement at $16.86 would be a positive, too.

A break below support puts more downside in play, while clearing overhead resistance could put the 50% retracement back on the table near $19.50.

Bret Kenwell is the manager and author of Future Blue Chips and is on Twitter @BretKenwell. As of this writing, Bret Kenwell is long NVDA and DIS.

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