Wall Street finished October in the red – the S&P 500, Dow Jones Industrial Average and the Nasdaq all shut lower for the month.
A few stocks avoided the pattern: Tapestry, Under Armor, GE and General Motors finished off October with twofold digit gains.
Embroidery, the top entertainer, could be setting up for a greater move higher, as indicated by Craig Johnson, boss market specialist at Piper Sandler.
“It sure looks quite bullish here,” Johnson told CNBC’s “Trading Nation” on Friday. “I would stick with this particular trade into November. You had your beat-and-raise quarter, you’re reversing a longer-term downtrend here on the charts.”
“Just looking at it and measuring it out, the next resistance really comes in around $28,” said Johnson. “Nice 25-30% upside from current levels. I would still be a buyer of this name in here.”
Not the entirety of the best entertainers may keep on revitalizing. Johnson predicts General Motors, which energized 17% in October, could pull back after income on Thursday.
Danielle Shay, head of alternatives at Simpler Trading, is additionally wagering against a top October entertainer – General Electric.
“It’s been very soft this year and, yes, it has rallied throughout October, but looking at the chart right now, you can see that it just rallied directly into the 200 simple period moving average. So for me, that looks like a short. It looks like a great place where I could sell some call credit spreads on this rally,” Shay said during the same “Trading Nation” segment.
GE rose 19% in October. The stock shut Friday at $7.42, beneath its 200-day moving normal at $7.64.