Want to start the week ahead of the pack? Check out Momentum Mondays, where I cover the leading breakout stocks in the market, summarize the major events of the week ahead, and prepare investors for profitable trading.
Today, we will be taking a look at the broad stock market indexes to summarize the action of the last few weeks, then we will look at theeconomic calendarand earnings releases to address any market moving data coming our way. And finally, I will share four compelling technical trade setups in stocks with top Zacks Ranks.
The Upcoming Week
There is a lot of important data coming out this week, from Federal Reserve and Treasury policy to the majority of the ‘Magnificent Seven’ reporting earnings.
The upcoming week promises economic data in the form of Job Openings and Consumer Confidence, as well as pivotal earnings reports from Microsoft, Alphabet, and AMD.
Wednesday’s agenda includes the ADP employment report and the FOMC interest rate policy meeting, along with the Treasury Department’s Quarterly Funding Announcement.
On Thursday, the market awaits Initial Jobless claims data and earnings calls from Apple, Amazon, and Meta Platforms.
Market Movements
After a market surge to new all-time highs, there are indications that the market is overbought. The Nasdaq 100 is bumping against its upper Bollinger Band, hinting at potential limitations to near-term upside.
Image Source: TradingView
Technical Trade Setups
Considering the cautious market outlook and crucial data releases, I am sharing two growth-oriented stocks and two more defensive ones. All these stocks have Zacks Rank #1 (Strong Buy) ratings.
First, we have Duolingo , which has formed a descending wedge.
Image Source: TradingView
The next technical setup is looking at Arista Networks. These first two are the more aggressive longs, which should benefit if the broader market continues to rally.
Image Source: TradingView
Next, we have Honda Motor Co., which is breaking out from a clear bull flag.
Image Source: TradingView
And finally, Davita, a healthcare company which leads the industry in dialysis treatment has been forming a two-month consolidation. The second two stocks should outperform in the case of a sell-off.
Image Source: TradingView
Parting Thoughts
Even the best trading setups fail, so it is always important for traders to prioritize making a trading plan, following the plan, and utilizing strict risk management protocols.
Good luck this week traders!
