Relative strength.
It seems easy enough. Wall Street meets with management teams continuously throughout the year (except during quiet periods). Analysts evaluate not only business strategy, but also business integrity. It's an opportunity for executives to lay out their business plans and strategies to the people that matter most - the Morgan Stanley's and Goldman Sachs' of the world. These are the folks that will create demand for the stock of Corporate America.
But how do you and I get to sit in on these meetings? Well, we don't. But astute technicians can look at the relative strength of companies in the same industry and get a quick feel for which companies Wall Street favors. Let me give you an example. Last week, General Electric (GE) and 3M Co (MMM), both diversified industrial companies ($DJUSID), reported quarterly results. I want you to look at these two charts and check out the key differences:
GE:
MMM:
I see huge differences in relative strength. GE has been outperforming its peers and the benchmark S&P 500, while MMM has lagged both. As they headed into earnings this past week, it was clear to me which one I'd own and which one I'd sell as the earnings announcement approached. Last week, I even wrote about MMM's likely disappointing earnings report in my Trading Places blog article, "I Will Guarantee You The Upcoming Earnings Performance Of These 2 Giants".
I pointed out that Apple (AAPL) would blow past estimates, which they did, and that MMM would deliver yet another disappointing report, which they did as well. Then last week, I provided dozens of upcoming earnings reports to EarningsBeats.com members, predicting both winners and losers before the earnings were released. The results were outstanding and can be found in another Trading Places article, written on Thursday. CLICK HERE to access that article.
The results did not include earnings reports out Thursday after the bell, nor Friday before the bell. Those reports, however, only added to the outstanding results that I'll share Saturday, February 1st at 2pm EST, in a free webinar that is open to the public!
I want you to join me at this webinar. This is what you'll get:
- A demonstration of a new Shared ChartList feature at StockCharts.com that allows me to easily provide a fully annotated ChartList with my chart styles.
- Our EB Digest newsletter (if you're not already a subscriber), which is completely free.
- A copy of my Strong Earnings ChartList, fully annotated with key price support levels.
- A demonstration of how to download this ChartList into your account. I'll show you how easy it is - it'll take me less than 10 seconds.
- The results from the earnings predictions of last week - it's quite impressive!
- My earnings predictions for next week, both bullish and bearish. I can't promise they will be as good as last week's, but I'll try my best!
I believe everyone will walk away with valuable education and, quite possibly, a few great trading ideas! Just be sure to click on the following link between 1:30pm EST and 2:00pm EST on Saturday, February 1st:
If you can't attend LIVE, send us an email to support@earningsbeats.com. We'll make sure you're set up in our free EB Digest and that you receive a recording of the event.
Happy trading!
Tom
