In my last ChartWatchers article, I discussed ways to profit from the terrific earnings season that we just experienced. So many companies put up solid numbers which led to the market reaching an all-time high.
I'm referencing my article from two weeks ago because it's a great lesson in patience. In fact, I'm including the same chart on AMD that I showed in that article.
You can see that I pointed out several potential entry levels on any pullback. In this case, averaging in and taking a 1/3 position at each level shown would have resulted in a blended price of close to $103. That's a whole lot lower than the peak price after earnings of $122.49, which is the price someone could have paid if they chased the stock after earnings.
AMD is only one example, as there were a ton of stocks that beat both top and bottom line expectations and guided higher that have similar charts and required patience as well. Snapchat (SNAP) comes to mind.
You can see in the chart above that SNAP gapped up sharply after the company reported its numbers. And, after that happened, there was a very nice opportunity to buy it on a pullback for a nice trade. In fact, it has set up for another nice opportunity as well.
The point is there are so many great opportunities that arise on those stocks that beat all expectations, especially if you are willing to be patient. It helps if you have a list to refer to -- i.e., to find potential trading candidates -- which is something we provide to our members on a regular basis. It's called our "Strong Earnings ChartList", which currently includes almost 600 charts on companies that have beaten Wall Street consensus estimates as to both revenues and earnings, are liquid and have solid technical charts. This is a POWERFUL tool and, if you would like to see a sample, just click here to sign up for our FREE EarningsBeats Digest. The sample list will be in Monday morning's newsletter.
Earnings season is a time to see which companies are performing at a high financial level. Zeroing in on those companies that beat all expectations should be an integral part of your trading platform.
At your service,
John Hopkins
EarningsBeats.com
