Tradetobefree.com, LLC, Investment Advisory Services, Cary, NC

Could This be the Best Earnings Season in Nearly a Decade?

 In Swing Trading

 

Finally, 6 weeks into the weakest seasonal period of the year, we saw a large down day for the market on Friday.

 

It took announcements of potentially an additional 100% tariffs on China and government layoffs due to the shutdown to finally generate a 3.5% down day for the Nasdaq.  Over the weekend, the administration began to walk back both initiatives.   Nasdaq and S&P 500 futures are both up over 1% Sunday evening

 

But early to mid October tends to be a more volatile period and we are finally seeing some of that expected volatility.

 

What Has Been Working When Swing Trading Over the Past Few Weeks

 

Meanwhile the only stock to meet all the rules in our #1 strategy for rapid account growth, WYFI,  reached the entry point and profit target the same day on Friday.  It still surprises me how well it works even on the worst day for the market since April.

 

INTC also reached the profit target while CLPT clipped the tight 4% stop-loss after reaching the entry trigger early in the week.

 

Those using the rapid account growth video instructions to find and trade these ideal trades are doing well.  As long as they are doing their watch lists and checking it each day to see if any meet all the rules pre market ahead of a potential breakout later that day.

 

Ideal earnings breakouts have been doing great overall despite the fact earnings season doesn’t even start until next week.

 

AIR and BYRN made a huge 15% to 20% move within a few days from the entry trigger which occurs after the earnings report.  In a prior post we talk about how there is no need to anticipate which companies will have the perfect beat and raise quarter.  You can do better by trading after the earnings report.

 

APLD failed an earnings breakout on Friday.  In a recent trading boot camp we talked about how a big down day for the market indices can affect win rates.  We gave the threshold where the overall market even matters right after a big earnings beat based on a 2 year back test and decade of trading experience.  Unfortunately, the market drop surpassed these thresholds on Friday.

 

But overall the performance of the strategies are clobbering other strategies over the past few weeks.  IONQ, INOD and QBTS were all big winners for those using the rapid account growth videos to find and trade our #1 strategy for rapid account growth.

 

What’s even more encouraging is that the strategies have been doing even better after a market pullback.  So it’s perfect timing that we are getting a pullback ahead of the best earnings gaps and consolidation breakouts starting soon after the banks start reporting earnings this week.

 

The best industries start to report earnings in about a week or so after the banks kick off earnings season on Tuesday.

 

Late October and November tends to be the best time of year for our strategies and the overall market.  So this is a particularly exciting moment that we will be taking full advantage of.  A market pullback sets things up even better for us.

 

We have about 150 to 200 ideal high tight flags heading into earnings season.  If market conditions worsen, we will be taking most of our profits at the first profit target.  On average we trade only about 20% of true high tight flag breakouts.  The ones that meet our rules the morning before the breakout later that day.

 

When Will the Market Bottom on this Pullback?

 

The trend line support of the forward P/E ratio for the S&P 500 is in the neighborhood of around 21 at this point.  So it wouldn’t surprise us to see another 4% to 5% pullback in the S&P 500.  However, many are calling for a quick recovery starting later this week and a rally into the end of the year.

 

So the stars could be aligning for us as the small cap indices have already hit new highs after basically 4 years of choppy consolidation if you don’t include the false breakout last November.

 

If the market indices fall into a correction, it could be a different story.  Upcoming news could be far worse than expected.  But this seems less likely at this point as it did in mid April when we went bullish.

 

It makes little difference, though, when you use our swing trading strategies in the rapid account growth videos with an average hold time of just 3 days.  Buy and holds along with position trading requires holding each stock a lot longer for about the same average profit in the case of position trading.

 

So what’s the best approach when in doubt?  Stick with the A+ trading opportunities where the technical and fundamental factors meet an even higher bar in whatever strategy you are using.  This could yield some big profits for us in the weeks ahead.

 

It’s time to get your watch list ready with only ideal opportunities.  It could get really good in the weeks ahead as we head into the best month for the market and our strategies.  November.

 

 

What to Look for in an Ideal Swing Trading Opportunity

 

How We Trade Elite Earnings Gap Trades Like the Ones That Will Come Up in the Weeks Ahead

 

Videos Teaching our Top 2 Strategies for Rapidly Growing a Small Account

 

 

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