Month: April 2021

Your 3-Step Profit Plan to Avoid “Earnings Roulette”

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Without question, the most reliable and consistent trading pattern on the planet is earnings. Big things happen at and before earnings for many stocks.

Many stocks gap at earnings. Netflix (NASD: NFLX) gaps all the time.

But in particular, it gaps before and after earnings, as you can see in this chart.


Notice that NFLX moves big up AND down into earnings. There are many other stocks that behave the same way.

When you’re trading these stocks, you may be tempted to pick direction and trade the run into earnings or even past earnings to play the gap.

If you pick direction correctly, you can bank.

Picking direction, however, is a bit like “betting on the black,” winning big if you’re right and losing big if you’re wrong.

In other words, earnings roulette. And who wants to play that?


Instead, I’ll give you 3 quick action steps to take that will help you profit during earnings no matter what.

How Moving Averages Can Enhance Your Trading Strategy

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This week, the markets have seen quite a bit of mixed movement.

In light of this, Chris Johnson and I are back in today’s Profit Strategy Podcast, covering our thoughts on how infrastructure package uncertainty and the new stimulus checks are impacting the market. We’ll also cover a few COVID-19 updates before talking about today’s focus, moving averages.

As always, it is important to identify key indicators that explain the trading potential of any position.

How Not to Get Spanked

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The sad truth is that most traders are going to get spanked this earnings season. If you want to join them, that’s your business.

If you’d rather make money instead, read on.

Trading is all about finding reliable, repeatable historical patterns and counting on them repeating into the future. I’ve made a great living on this fact. Everything I do is based on rules-based systems that historically produce consistent profits.

The most reliable pattern by far is produced by earnings announcements. On many stocks, earnings creates gaps on specific, pre-announced dates. We have a precise triggering event on a pre-defined date. It gets no better than this.

And yet, most people play it completely wrong.

Check out the chart below on Zoom Video Communications (NASD: ZM):

The green “E” triangles are pre-announced earnings dates. Notice that over the past 3 earnings, Zoom gapped up, then down and then dropped big AFTER the announcement.

See, most people are trading earnings the wrong way. They essentially “bet on the black” by trading directionally over the earnings. They buy stock, short stock or buy calls or puts and hold over the announcement hoping that the stock moves their way.

This is a sure-fire way to get spanked.

A smarter way is to trade both directions by buying calls AND puts, creating a straddle. This is a safer way, but not the best way.

OK, you’re now wondering what’s the best way.

And I’m about to tell you…

How to “Scalp” Massive Profits with The Little-Known IV Surge

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Demand for stocks and options is at record highs. It’s a veritable “Traders Gone Wild” environment as retail traders (that’s you and me) gobble up stocks and options. The party started in 2020 and traders are pumping up the volume with even more exuberance.

Indeed, CNBC reports that average daily volume in stocks is skyrocketing:

Year Stock Volume*
2019 7 billion
2020 10.9 billion
2021 14.7 billion (so far)

*Source: Piper Sandler

And it isn’t just stocks that are getting extra attention.

Check out how options volume has exploded over the past 2+ years:

Year Options Volume^
2019 1.8 billion
2020 2.5 billion
2021 0.9 billion (so far)

^Source: cboe.com

Interactive Brokers’ Steve Sosnick indicates that there has been a phenomenal rise in short-term call option trades.

So, where’s all of this extra volume coming from?

Millennials.

With the advent of retail brokers like Robinhood offering $0 commissions, millennials are flooding the markets. This is evidenced by the 6-million strong Reddit community that created a massive short-squeeze, sticking it to Wall Street hedge funds.

This demand creates movement. Stocks move farther and faster than ever before. The same is true for options.

All that spells one thing…. OPPORTUNITY!.

Let me share something with you that VERY FEW traders know…not even the pros….

“COVID Stocks” are Falling – Use these Two Strategies to Profit

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“Turn out the Lights, the Party’s Over”

This song, for me and I’m sure many of you, was made famous by Don Meredith on Monday Night Football.

This week, these words came back to me loud and clear as companies that saw major gains during quarantine began to decline.

It’s clear that the “party’s over” for these streaming, food delivery, and home-shopping stocks as the world returns to normal, and I have two ways to play this move to the downside for major profits.

You can get all of the details by clicking here…

Three Opportunities to Profit on the Rebounding US Dollar

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In 2020, the US dollar dropped over 10%.

Now, the dollar, which is often considered one of the most stable currencies in the world, is gaining traction as people put their money back into the markets.

That’s why today I am going to share why I’m so bullish on this currency and why now is the time to get in.

I’ll go over the top three moneymaking trades that will benefit as the dollar rises, and exactly how to profit.

It’s a video you won’t want to miss, so click here to watch…

The Four “Phoenix Rising” Tech Stocks to Buy Right Now

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In the first three months of 2021, tech stocks took a major hit, down 5% on the year as of March 4.

And it makes sense!

Everybody already bought the latest editions of their phone or gaming console, downloaded all of the latest Work From Home software, and upgraded streaming services (here’s to you “no-ads” Hulu.)

Major companies have been struggling to keep up with the unprecedented demands of 2020, and we saw the repercussions of this over the past couple of weeks.

During March, money was flying out of the tech sector… but not out of every tech stock…

Which is why as we start the month of April, I found the top four stocks that are “rising from the ashes” and will get a major boost on money flowing back into the technology market.

These stocks have been in the green and are set to run further to the upside during one of the most profitable months of the year.

You can get all of the details by clicking below.