5 Top Stock Trades for Thursday: NIO, ANF, ROKU, MU, DLTR

Stock Market

The markets took a hit on Wednesday, with small caps leading the charge lower. Is it a sign of things to come? We’re definitely taking notice with the recent weakness and whether that will escalate to more selling pressure in the coming days. With that in mind, here are the top stock trades to watch going into Thursday.

For those looking General Electric (NYSE:GE) and Huya (NYSE:HUYA), we covered both on Tuesday, here.

Top Stock Trades for Tomorrow #1: Nio

Investors aren’t too receptive of Nio’s (NASDAQ:NIO) earnings results, as shares plunge about 20% in response to its fourth-quarter report. On the bright side — if we can call it that — Nio stock is still above $8 a share.

$6 to $8 was a key range for Nio from October through February. If Nio stock can stay north of $8, bulls will have something to find comfort in. With this poor reaction though, it may be hard to imagine Nio staying over this mark. Let’s see how it shapes up going into the weekend. Below $8 and $7.50 is on the table. Should that mark and the 50-day fail to support Nio, a decline to $6 support may be in the cards.

Top Stock Trades for Tomorrow #2: Abercrombie & Fitch

top stock trades for ANF earnings

On the flip side, we have Abercrombie & Fitch (NYSE:ANF) rallying 21% after better-than-expected Q4 earnings.

No one likes to chase a stock up 20%, but as we’ll see in a moment, sometimes that just means more gains are on the way. In the case of ANF, look for a slightly lower open on Thursday that quickly goes green. Should it do so, it could spark a continued rally and leave late-to-the-party bulls with a favorable risk/reward.

If it works its way up to $28 over the next few days or weeks, look for this level to be resistance.

Top Stock Trades for Tomorrow #3: Roku

top stock trades for ROKU

So what stock goes up 20% and then just keeps going? Look no further than Roku (NASDAQ:ROKU). (Although to be fair, the stock rallied more than 25% the day after earnings).

Interestingly, this stock initially fell in after-hours trading on its earnings day and was only up a few perfect the next morning, before gaining some early momentum and surging higher. After closing a bit under $65 on day one, we’re up almost another 10% in Roku, which received not one but two notable upgrades on Wednesday.

As much as I love Roku (and I really do for the long term), this move has been frighteningly strong. Should it push up to $75 or so, it will likely be met with profit taking. Ultimately, I want to see $65, a key level in the past and notable post-earnings mark over the last few weeks, hold up as support.

Top Stock Trades for Tomorrow #4: Dollar Tree

top stock trades for Dollar Tree earnings

Buyers had to be convinced, but after a soft open on Wednesday, Dollar Tree (NASDAQ:DLTR) has been trending higher all day, up more than 5% after better-than-expected earnings.

The rally thrusts DLTR over $100, a key resistance mark over the past year. If DLTR can’t hold this rally, look for the 50-day to act as support. This mark was a springboard for Dollar Tree on Wednesday. Just below it is the backside of prior uptrend resistance.

I want to see a further rally and/or consolidation in DLTR above $100 in the next few sessions. If so, it will increase the likelihood of a continued rally in the stock. If the markets don’t hold up and weigh on DLTR’s ability to rally, watch the 50-day.

Top Stock Trades for Tomorrow #5: Micron

top stock trades for MU

Analyst concerns over memory pricing hit Micron (NASDAQ:MU) to the tune of almost 5% on Wednesday.

The writing was on the wall with this one. Uptrend support (blue line) gave way at the end of February and the subsequent retest of this level failed. That was a huge red flag and it’s no surprise MU is under pressure Wednesday, news or no news.

The 50-day is support for now, but look out if it gives way. A drop to $34 wouldn’t be out of the question if that’s the case. For me, MU isn’t safe unless the 50-day holds and it gets back above the 21-day. Even then, there are better setups out there.

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

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