Pick Your 'Poison' During Earnings

2020-07-21 | Simpler Trading Team

Twists and turns in the market continue with more than 450 companies set to report earnings this week.

Some of the recent high-flying technology tickers with earnings on the horizon took it on the chin today, and the results saw the Nasdaq drop .81% on the day to 10,680.36 points.

The Dow pared back a 300-point intraday peak to close at 26840.40 for a gain of .60% and 159.53 points. The S&P 500 chugged along with a near flat .17% uptick to close at 3,257.30 points.

Traders expecting a stable run into earnings or watching for “lotto” style earnings trades have much to consider with the market churning as it is.

Earnings are unpredictable and can be scary for those without a plan or established triggers for trade setups. High-probability plays can present themselves for those who know how to pick their poison as companies report.

Having a disciplined plan in place helps traders who want to profit from earnings. For those without a plan in place, don’t let FOMO (Fear Of Missing Out) tempt you into rash decisions. A high-flying ticker and expectations of a positive earnings report can crumble with the next bad news cycle.

In this wild market, sometimes the best trades on the table are “none,” as in don’t trade without strong setups. Limiting trades and going slow and steady through earnings can help maintain a trading account.

We Saw: tech-fueled Nasdaq stumble — 

  • Dow, S&P 500 paring gains but holding positive
  • Flurry of earnings reports continues this week
  • Energy sector gaining some wind in its sails

We’re Watching: for strong earnings setups with limited risk —

  • Tech sector taking hits with many reporting earnings this week
  • Profits to take off now before earnings
  • Setups in: AMD, KR, LULU, ROKU, SNAP 

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