The Post Earnings list has been updated. This list contains all stocks that had an 4% move or greater on the day of their earnings starting April 1, 2011
Setups to watch next week.
Polaris Industries Inc.(Public, NYSE:PII)
Baidu.com, Inc. (ADR)(Public, NASDAQ:BIDU)
Pharmasset, Inc.(Public, NASDAQ:VRUS)
Weight Watchers International, Inc.(Public, NYSE:WTW)
If you miss them, you just have to let them go and move onto the next trade.
Stocks with earnings surprise and raised guidance today.
|BIDU||4||Baidu.com, Inc. (ADR)|
|CDNS||12||Cadence Design Systems, Inc.|
|CTXS||19||Citrix Systems, Inc.|
|MANT||2||ManTech International Corporation|
|BABY||18||Natus Medical, Inc.|
|DLR||7||Digital Realty Trust, Inc.|
Below are a few stocks to watch for break outs over the next few days.
True Religion Apparel, Inc.(Public, NASDAQ:TRLG)
Keynote Systems, Inc.(Public, NASDAQ:KEYN)
OPNET Technologies, Inc.(Public, NASDAQ:OPNT)
Helmerich & Payne, Inc.(Public, NYSE:HP)
The Post Earnings list has been updated. This list contains all stocks that had an 8% move or greater on the day of their earnings.
One simple and straight forward approach to buying and selling stocks is looking at support and resistance levels. Being a fan of the K.I.S.S principle to trading, I like to apply these concepts for my swing trades.
“A support level is that price at which one may expect a considerable increase in demand for a stock, or buying. A resistance level is that price at which one may expect a considerable increase in the supply or selling.” – How Charts Can Help You in the Stock Market, JilerScanning for stocks bouncing off support or breaking through resistance to new highs can offer two trading opportunities for making profits.
We always want to be in the best performing stocks in the market. To find these we can rank every stock’s performance over N number of days. Next, we look at the top stocks from this list to find buyable candidates. In Bluefin, we’ve filtered out the strongest stocks in the StockBee Trend Intensity, Sector 50, Earnings 50 and Post Earnings Surprise watch lists.
When looking at a trade, I will typically break it into two moves. First, we have the move from support to the resistance level. Then you have another trade where the stock breaks through the resistance to new highs. The move into new highs normally rewards the trader a higher percentage than between the two support levels.
Why do some stocks break through to new highs while others fail?
As our friend Laser put’s it, they do not have enough “Post Earnings Juice” to over whelm the sellers and push the stock to new highs. When this does occur, it can cause a feeding frenzy as the people who did sell, now panic to get back in.
Post Earnings Juice is all the good things you get out of earnings day. Stocks that blow out earnings, raise guidance, announce new sales agreements, receive upgrades have Post Earnings Juice. The perfect cocktail to drive stocks to new highs.
Following stocks with the highest relative strength will offer better opportunities for buying stocks bouncing off support. These stocks have proven themselves with strong uptrends prior to their pullback. The expectation is they will pullback after an initial 20% move or higher. After taking a breather they will continue their move upward.
Trades off support can be a bit more challenging versus a stock breaking through resistance into new highs. The best trade is trading the stock as it breaks through the previous high to new highs.
There is a higher chance the stock will continue moving sideways as it consolidates. Looking at OPEN (OpenTable Inc) you can see three different support areas with two having several weeks of consolidation while the middle only had two days.
I currently use the Harpoon scan to spot these moves. It scans all stocks up 1$ or greater. You can also use: c1 < avgc4.1 and c > avgc4. Basically, this scan looks for stocks making a short term trend reversal using the 4 ema. I was initially introduced to the 4 ema by Tumbler over at TumblerTrades.com when he was a Stock Bee Member. He uses this indicator for his day trading methods.
Let’s take a closer look at PANL. On 4/19, PANL ( universal display ) showed up on the Harpoon scan. It has a very strong prior uptrend and pulled back close to the 50 ma. It made a higher low compared to the day before and the market looked like it was turning at these levels.
My first target was the previous high made on 4/6/2011. At this level, the stock will either break out to new highs or fail. Taking profits on the third day and wait and see seems like a logical choice. The stock has to make 20% from pullback to resistance. If it was smaller percentage (8% or less) holding the stock would make sense.
IPGP is a good example of a tight consolidation where the stock had plenty of juice to make new highs. Buying the stock as it makes the new high is the best entry point for tighter consolidations like this. Otherwise, it’s possible the stock bounces back and forth between resistance and support for the next week.
When you enter a stock on the pullback you have three scenarios. A. The stock will go up making higher lows. B. The stock will continue consolidating and move sideways. C. The stock will make a lower low. I will sell on both option B and C and try again later.
There are some profitable opportunities trading support and resistance levels on high momentum stocks. Play deeper pullbacks up to 20% by trading bounces off support or wait for the break out to new highs on tighter pullbacks of 8% or less. Sell into strength and sell when the stock does not follow your plan.
Below are the best looking setups from today. Careful, it’s earnings season, check your stock earnings date before buying.
|CAR||Rental & Leasing Services||Value 50|
|CPHD||Scientific & Technical Instr||Short 25|
|SIMO||Diversified Electronics||Sector 50|
|SFLY||Consumer Services||Sector 50|
|DFS||Credit Services||Post Earnings Surprise|
|MSTR||Business Software & Services||Post Earnings Surprise|
|OPEN||Business/Management Services||Post Earnings Surprise|
|WMB||Oil & Gas Pipelines||Post Earnings Surprise|
|RL||Textile-Apparel Clothing||Post Earnings Surprise|
|CRDN||Industrial Equipment & Compone||Post Earnings Surprise|
|EMC||Data Storage Devices||Emerging 50|
|ASNA||Apparel Stores||Emerging 50|
|ULTA||Personal Service||Emerging 50|
|WFMI||Grocery Stores||Emerging 50|
Stay Out. That’s the best I can do after today’s action. We had a few great looking setups with a leaders like MELI, LULU, and OPEN.
But then we had many of the indexes dropping through their 50 day moving averages. Are these stocks making moves ahead of the next leg up or are they gasping for one last breadth before tanking?
Taking a peek at breadth we can see a slow degradation in breadth over the past week with overall negative breadth for the past 6 days days creeping higher than the positive breadth. To add to the confusion the primary breadth indicator remains positive.
At this point, a few more days should provide clarity with a move to the downside or a bounce higher.
I just moved over a updated version of Bluefin. One feature that has been requested by many users is the ability to view all the charts at once over at Finviz. You can now click the Finviz button at the top of the page.
Mark Minervini has an excellent post over at this site:
There are literally thousands of companies listed on the New York Stock Exchange or the NASDAQ. Of all these names, only a portion is followed closely by analysts. Typically the larger...
via StockCharts.comNice setup.
via StockCharts.comNice move
This weeks Earnings Surprise List
We crawl through the earnings reports daily and record which stocks beat estimates and by how much. In Bluefin, you can then access this information in several ways. Through the Post Earnings Surprise and Today’s Earnings options found in the watch list drop down.
The Post Earnings Surprise watch list grabs all stocks with a six percent move or greater on the day of earnings.
As Laser has explained in his post, you can review this list for stocks setting up for a new leg up after their initial earnings thrust.
This list combined with companies that have raised guidance and announced some new sales deals like GMCR or BIDU can offer stocks making a sizable move in a fairly short time frame. TDSC announced an offering soon after blowing out earnings which gave us a nice opportunity to catch it after pulling back from the new offering.
Keeping track of stocks that blew out earnings and had a significant move on the day of the release will allow you to focus your money in the cream of the crop stocks. Blow out earnings plus significantly raised guidance for the quarter is a recipe for double digit returns.
In Bluefin, the Percolator scan looks for stocks with a 2% move or greater breaking above their 5 day max close. This scans across all watch lists and catches Post Earnings Surprise stocks meeting the criteria. If you want to focus on Post EP list you can filter the Percolator to only display those stocks by selecting Post Earnings Surprise from the filter Menu.
The hard part is keeping this information organized, that’s where these lists come into play. A week or more later when the stock has pulled back from highs, you can see a new entry signal in Bluefin or set alerts in your favorite charting program.
Below are some recent setups from the Post Earnings Surprise watch list.
Air Methods Corporation(Public, NASDAQ:AIRM)
3D Systems Corporation(Public, NASDAQ:TDSC)
Baidu.com, Inc. (ADR)(Public, NASDAQ:BIDU)
Green Mountain Coffee Roasters Inc.(Public, NASDAQ:GMCR)
Wow, another nice setup from Bluefin.
via StockCharts.comAnother nice setup from Bluefin.
Another nice setup from Bluefin.
via StockCharts.comNice setup from the Percolator Scan in Bluefin. Waiting for new highs on this one.
NYSE Composite Index ($NYA): "
via StockCharts.comBreak Out or Break Down? Stay tuned next week.
via StockCharts.comNice setup, gold and silver moving today.