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Top Swing Trade Ideas for Thursday, August 7: First Solar, Pepsico, More

NEW YORK (TheStreet) -- Good day, traders!

Today's top swing trade picks are First Solar (FSLR - Get Report), Pepsico (PEP - Get Report) and Tesla (TSLA - Get Report).

1. First, let's look at First Solar, which provides solar energy solutions worldwide.

First Solar traded up 3.05% on Wednesday, and closed at $65.60 per share.

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  • Wednesday's range: $60.15 - $65.94
  • 52-week range: $35.59 - $74.84
  • Wednesday's volume: 9,114,741
  • 3-month average volume: 2,970,850

First Solar looks good to me as a swing trade, as yesterday's volume was three times the normal trading volume. Also, the price action traded up over the 50-day simple moving average and closed over the 50-day SMA. Yesterday's candlestick engulfed many of the previous trading days, and closed right at the resistance level.

This is a trade that is the classic swing trade, since First Solar has been trading sideways since about March, and there's no reason to believe that sentiment has changed. As swing traders, we can play the swings in a sideways trading scenario.

I'd look to enter this trade above $65.31, which is the 50-day simple moving average to be safe. For those of you with a higher tolerance, I'd enter as low as the 20-day simple moving average, at $63.56, and trade it to the peak of the sideways trading channel. I'd set my stop just below the 20-day simple moving average, at say $63. My first target would be the top of the sideways trading channel, at $71.85, which is about 9.5% to the upside from yesterday's close.

Stay long until you see a confirmed sell signal or a close below the t-line.

2. Now let's look at the food and beverage giant, Pepsico.

Pepsi traded positive on Wednesday, closing up to $90.51 per share.

  • Wednesday's range: $88.67 - $90.76
  • 52-week range: $77.01 - $93.09
  • Wednesday's volume: 6,437,109
  • 3-month average volume: 4,079,340

Pepsico doesn't always satisfy, but it does right now -- and it looks good technically. Pepsico has been in a bit of a pullback for the last week or more. The price action pulled back below the 50-day simple moving average and is turning around.

There is a 3-day candlestick signal happening. First there is a bullish candle, followed by a doji-type candle, then followed by a bullish engulfing signal -- 3 bullish signs. (A doji chart has a stock price that opens and closes in almost the same spot, but it may be wide-ranging in price over the course of the day.)

Yesterday, Pepsi closed above the 20-day simple moving average, and it looks to be heading back to the bullish trend that started back in February. This is a pullback opportunity, and allows us to get a cheaper entry price on a chart that is in a solid uptrend.

Look for an entry around $90 or above. Then, I'd set a stop at about $89. Then, I'd target the top of the trend channel and take profits at the top of the channel, then add to the position on pullbacks. Eventually, Pepsico is heading to $100.

Stay long until you see a confirmed sell signal or a close below the t-line.

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SYM TRADE IT LAST %CHG
FSLR $45.31 0.00%
PEP $96.63 0.00%
TSLA $266.79 0.00%
AAPL $122.37 0.00%
FB $95.21 0.00%

Markets

Chart of I:DJI
DOW 17,745.98 -5.41 -0.03%
S&P 500 2,108.63 +0.06 0.00%
NASDAQ 5,128.7850 +17.0520 0.33%

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