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Wednesday predictions: 3 hot stocks for tomorrow

As we enter earnings season, investment calendars are starting to fill up. This has investors wondering what the hot stocks of tomorrow will be.

While it helps that the Federal Reserve has entered its blackout period, it doesn’t help that we have a meeting of the Federal Open Market Committee (FOMC) in early February. That’s when the Fed plans to raise interest rates by 25 basis points. This increase could add to the volatility that equity investors have experienced over the past year.

Even though earnings started over a week ago, we are finally starting to tackle the most impactful names when it comes to consumption, economics and technology.

netflix (NASDAQ:NFLX) led the story last week for tech, and now Big Tech will be in the spotlight again. Let’s look at hot stocks for tomorrow – Wednesday January 25th.

Hot stocks for tomorrow: Microsoft (MSFT)

Microsoft (NASDAQ:MSFT) is the second-largest company in the United States by market capitalization, with a market capitalization of $1.8 trillion. The company will release its results after Tuesday’s close, so it will be finalized on Wednesday morning.

Keep in mind that just a few weeks ago, Microsoft stock was about to retest its 52-week lows. While the market has been trading much better lately, it would be a mistake for investors to let their guard down completely.

Analysts expect revenue growth of around 2.5% to around $53 billion. On the earnings front, they actually expect a 7.7% drop to $2.29 per share. Investors will be looking for higher and lower momentum and a bullish outlook from the company.

Microsoft recently announced a reduction in its workforce, joining Amazon (NASDAQ:AMZN) and other large-cap tech stocks. He also made headlines following a multi-billion deal with Open AIthe company behind artificial intelligence (AI) chatbot, ChatGPT. So investors will want more details on this.

Table: The bulls want to see Microsoft shares break through the $245-$246 zone. This opens the door to the 200-day moving average and then the December high near $264. On the downside, they want the stock to hold the $235-$230 zone. Below this zone opens the door to the 200 week moving average and uptrend support.

Boeing (BA)

Boeing (NYSE:BA) will release its results before Wednesday’s open. This stock became famous for the implosion it suffered following the Covid-19 pandemic. The shares had already suffered from an incident with its 737 MAX jet in the first quarter of 2019. A year later, a global pandemic would send the stock into a tailspin.

In a matter of weeks, stocks lost 73% of their value between the 2020 high and the 2020 low. From its all-time high, Boeing stock has fallen almost 80%.

As recently as October, Boeing stock was poised to hit its 2022 low. However, it was able to backtrack and stage a six-week rally. Prior to last week’s decline, Boeing had climbed in 13 of the past 15 weeks, rallying 79% in the process. Does this set the bar high enough for revenue?

We are at an interesting point in the economic cycle. On the one hand, fears of a recession loom in the not too distant future. On the other hand, we have just heard from Delta Airlines (NYSE:DAL), United Airlines (NASDAQ:LAU) and others that air traffic demand is robust. Then you add defense spending, and Boeing certainly has potential catalysts.

The only question is how high has the bar risen after the massive rally in the stock?

Table: Keep an eye out for recent resistance near $215. Above it opens the door to the $225-$227 zone. On the downside, bulls want to see Boeing hold the bullish 10-week moving average. Below that technically opens the door to the $170-$180 zone.

Tesla (TSLA)

Call it a tech company, call it a car manufacturer…call it You’re here (NASDAQ:TSLA) whatever you want, but it will be finalized after Wednesday’s close when it reports fourth quarter results.

This stock has become extremely volatile over the past few months, and all eyes will be on Tesla and Elon Musk on Wednesday. Shares fell more than 67% from August high to recent low, while recording five straight months. From its all-time high, stocks have suffered a 75% loss, from high to low.

Despite record fourth-quarter deliveries and a strong 2023 outlook, Tesla stock has still struggled, though it has rebounded nicely, up more than 40% from the recent low.

Table: On the upside, the $150-$155 area is huge. If the bulls can get it back, it could open the door up to $200. Otherwise, this area could act as resistance in an intermediate future. On the downside, bulls want to see Tesla shares hold the $120-$125 zone.

As of the date of publication, Bret Kenwell held a long position in TSLA and MSFT. The opinions expressed in this article are those of the author, subject to InvestorPlace.com publishing guidelines.


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