Breaking from the mold of traditional earnings research. Doing a full blown historical analysis on Adobe Systems (ADBE)
AS A NOTE: The strength of each trade can be gaged by the MACD Histogram. If the trade agrees with the Histogram, it will more than likely be a major success. Also, once the Histogram bars start shrinking up, that is your signal to exit the trade.
January
In late December & early January, watch for a FP or HRFP going either up or down to "kick off the new year." Keep in mind that Adobe has a historically negative bias in the month of January, so even if it's an up move, the up move can dry up and turn into a down move. If you see the MACD Histogram dry up mid month and then a HRFP or FP going down, follow this move.
February
Highly unpredictable and not always volatile enough for trading. Avoid this month.
March (Earnings Month)
No reliable plays despite having earnings this month.
April
Usually has a FP or HRFP going either up or down in the first few days. In some instances this move begins on the first trading day of April. It is imperative that the FP/HRFP agree with the MACD Histogram. If the HRFP or FP does not agree with the Histogram, do NOT execute the trade.
April can sometimes have a good move mid-to-late month. Again, you need agreement with the HRFP or FP and the MACD Histogram.
May
Usually produces an early to mid month FP or HRFP going either up or down. Watch for agreement with the FP/HRFP and the MACD Histogram.
June (Earnings Month)
Watch for a FP or HRFP (ONLY to the down side) that agrees with the MACD Histogram following earnings. After earnings, if there is a FP or HRFP going down and it agrees with the MACD Histogram, this can produce an absolutely spectacular drop in the stock's price, with major profit potential to be had.
July
Usually has a FP or HRFP going either up or down early in the month. In this particular case, the 200 period moving average line can heavily interfere with any move (up or down) so it is unwise to trade if the 200 period MA line is blocking any potential moves. As always, make sure there is agreement with the MACD Histogram.
August
Highly unpredictable and not always volatile enough for trading. Avoid this month.
September (Earnings Month)
No reliable plays despite having earnings this month.
October
Usually has a FP or HRFP going up or down early in the month. If this move occurs, it will last at least until mid month. Use the MACD Histogram to determine when the move is over. Once the move ends it will either reverse or go flat. On very rare occasions, the move lasts all month - you can tell when the move is over by if the MACD Histogram begins drying up.
November
Exact same as October.
December (Earnings Month)
Watch for FP or HRFP (ONLY to the down side) anywhere from a week to a few days before earnings. When the MACD Histogram dries up, there's your cue to exit the trade. In some instances, the MACD Histogram does not dry up. In which case, do the smart thing and exit the day before earnings.
Thursday, December 30, 2010
Monday, November 1, 2010
NVDA Earnings Research
The following is a summary of findings from my earnings research of Nvidia (NVDA):
February Earnings
Tends to have either a FP or HRFP going EITHER up or down in early to mid January. This movement up or down can last for varying lengths of time. During the trade, watch the MACD Histogram. If the Histogram starts to dry up (the bars start to shorten or disappear) then the trade is over, and the stock is getting read to either reverse or go flat.
February Earnings
Tends to have either a FP or HRFP going EITHER up or down in early to mid January. This movement up or down can last for varying lengths of time. During the trade, watch the MACD Histogram. If the Histogram starts to dry up (the bars start to shorten or disappear) then the trade is over, and the stock is getting read to either reverse or go flat.
May Earnings
Tends to have a rise or fall beginning in early to mid April. Pay close attention to both the StochRSI and MACD Histogram for entry points. The Histogram will signal an exit when the bars start to dry up.
Watch for an early to mid month move in June (up or down). The move will be signaled by a combination of a FP/HRFP AND a reversal in the MACD Histogram (the bars will go positive to negative, or vice versa).
August Earnings
In July, this stock tends to do one of two things:
- Rise from early to mid July, then Fall from mid to late July.
- Fall from early to mid July, then Rise from mid to late July.
Watch both the StochRSI and MACD Histogram. When there's a FP or HRFP where the StochRSI and Histogram agree, there's your early July trade. Once the Histogram BEGINS to dry up, exit the trade. Once the Histogram has completely REVERSED, enter a trade going in that direction till late July
In late August and early September: A FP or HRFP (going either up OR down) will carry the stock into mid September. Here, it will either "rest" then continue moving in the same direction, or it will reverse. In mid September, once the Histogram dries up, exit the trade, then watch for another move.
EDIT: this move will have a CLEAR AND OBVIOUS signal on the StochRSI. If the StochRSI is not CLEAR AND OBVIOUS then the rise/fall hasn't actually started.
EDIT: this move will have a CLEAR AND OBVIOUS signal on the StochRSI. If the StochRSI is not CLEAR AND OBVIOUS then the rise/fall hasn't actually started.
November Earnings
Usually begins rising between late November and early December following November earnings. This rise is usually followed by a fall that begins in late December to early January. If the rise occurs, expect the fall to occur from 2 to 4 weeks afterward.
You'll know the rise is coming when there is a FP or HRFP where the StochRSI and the MACD Histogram agree. The rise is over when the Histogram bars dry up. The fall begins when a Histogram bar going down appears.
Thursday, August 12, 2010
August 12th, 2010
No major news or stock movements to report today. Looks like the market as a whole is digesting the negativity that is omnipresent on a global scale.
I'm anticipating that it may stay flat to down till the last 2 weeks of August, at which point it should take a nose dive into Labor Day.
I'm anticipating that it may stay flat to down till the last 2 weeks of August, at which point it should take a nose dive into Labor Day.
Wednesday, August 11, 2010
August 11th, 2010
The economic recovery is definitely slowing, and there are very serious concerns that China's economy is slowing. In addition, some "experts" are saying that when they "read between the lines" of a July Fed meeting, they believe the US as a nation is essentially bankrupt. Other experts are saying that Federal Bonds (also called T Notes) should be dumped and that stocks should be avoided.
Doom and gloom reign on Wall Street at the moment. There is speculation that the government may have to double taxation rates to compensate for the overextension of our budget.
This fall should be interesting. We may see another crash similar to late 2008.
Doom and gloom reign on Wall Street at the moment. There is speculation that the government may have to double taxation rates to compensate for the overextension of our budget.
This fall should be interesting. We may see another crash similar to late 2008.
Tuesday, August 10, 2010
August 9th, 2010
Pretty much no news to report. The only shred of news to come out today involved a report that China's trade deficit is at a record high (meaning they are exporting WAY more than they are importing).
News today was flat... market was flat... no noticeable entry points or any noticeable price action popped up.
News today was flat... market was flat... no noticeable entry points or any noticeable price action popped up.
Saturday, August 7, 2010
August 6th, 2010
First, an update on NVDA and SHLD. NVDA appears to still be caught in the grips of a massive downtrend. It is showing signs that it may be bottoming, but there is no way to be certain.
As of the close of this week, SHLD had a FAT PITCH going up on the weekly chart, indicating it has shifted into an uptrend. I will watch SHLD closely for an entry point on either the daily or 55 minute charts.
The Fed is now talking about the possibility of creating additional economic stimulus in the face of increased initial claims for unemployment, and a slowing of hiring. The Fed had been talking about an exit strategy - that is, a strategy that will allow them to take government money out of private enterprise and let private enterprise resume running itself.
The dollar is the weakest it's been in several months, and with payrolls shrinking things are not looking good for consumers. Corporations that export their products overseas to continents such as Asia and Europe, though, should be happy since this will point to greater profits coming in from overseas. Ultimately I have always felt that a weak dollar is good for American business, because it will allow us to become a nation of exporters again. This is because, if our dollar is weaker, other nations will find our products cheaper to buy.
As of the close of this week, SHLD had a FAT PITCH going up on the weekly chart, indicating it has shifted into an uptrend. I will watch SHLD closely for an entry point on either the daily or 55 minute charts.
The Fed is now talking about the possibility of creating additional economic stimulus in the face of increased initial claims for unemployment, and a slowing of hiring. The Fed had been talking about an exit strategy - that is, a strategy that will allow them to take government money out of private enterprise and let private enterprise resume running itself.
The dollar is the weakest it's been in several months, and with payrolls shrinking things are not looking good for consumers. Corporations that export their products overseas to continents such as Asia and Europe, though, should be happy since this will point to greater profits coming in from overseas. Ultimately I have always felt that a weak dollar is good for American business, because it will allow us to become a nation of exporters again. This is because, if our dollar is weaker, other nations will find our products cheaper to buy.
Thursday, August 5, 2010
August 5th, 2010
First: an update on NVDA and SHLD. NVDA is finally showing signs of heading up going into earnings whereas SHLD seems to be making up it's mind as to what it wants to do.
Some data came out today that is contradictory to yesterday. Even though it was reported that there are more jobs being created, unemployment claims unexpectedly rose to a 3 month high last week. However, even though the number of people filing initial claims rose, the overall number of people continuing to draw unemployment has been falling, which may explain the contradiction in the data.
This indicates that firings and layoffs are accelerating, which may be symptomatic of the fact that summer is coming to an end and some seasonal positions may be in the process of being vacated. Payrolls are falling as well. If we consider that payrolls are falling and firings are accelerating, even if more jobs are created the lower payroll number by itself indicates less money in the pockets of consumers, which means less consumer spending.
This assumption falls in line with the July retail sales results, which shows retail sales are declining. This number should improve in August, however, as families get ready for their kids to go back to school.
Finally, some analysts are calling for more stimulus money as the recovery appears to be weakening. With job growth weak and consumer spending weak, we're looking at a long, slow recovery at best.
Some data came out today that is contradictory to yesterday. Even though it was reported that there are more jobs being created, unemployment claims unexpectedly rose to a 3 month high last week. However, even though the number of people filing initial claims rose, the overall number of people continuing to draw unemployment has been falling, which may explain the contradiction in the data.
This indicates that firings and layoffs are accelerating, which may be symptomatic of the fact that summer is coming to an end and some seasonal positions may be in the process of being vacated. Payrolls are falling as well. If we consider that payrolls are falling and firings are accelerating, even if more jobs are created the lower payroll number by itself indicates less money in the pockets of consumers, which means less consumer spending.
This assumption falls in line with the July retail sales results, which shows retail sales are declining. This number should improve in August, however, as families get ready for their kids to go back to school.
Finally, some analysts are calling for more stimulus money as the recovery appears to be weakening. With job growth weak and consumer spending weak, we're looking at a long, slow recovery at best.
Wednesday, August 4, 2010
August 4th, 2010
The US Economy received a slightly brighter outlook today. Figures show that employment is increasing faster than expected. This combined with continuing low mortgage rates are going to help the long term economic outlook.
NVDA and SHLD are showing signs that they may be bottoming and may be ready for a move upward. Tomorrow or Friday should reveal what these stocks are actually going to do.
In a side note: the dollar is rising in value vs. the yen, which is good for Japanese companies that export goods to America. This means higher profits for Japanese firms, which may signal an increase in stock prices.
NVDA and SHLD are showing signs that they may be bottoming and may be ready for a move upward. Tomorrow or Friday should reveal what these stocks are actually going to do.
In a side note: the dollar is rising in value vs. the yen, which is good for Japanese companies that export goods to America. This means higher profits for Japanese firms, which may signal an increase in stock prices.
Tuesday, August 3, 2010
August 3rd, 2010
It's definitely summer time and the markets are making up their mind as to where they want to go. We're definitely looking at a drop going into Labor Day, and then post Labor Day we'll see the yearly "Post Labor Day Pop" upward followed by a hard sell off.
There are a few stocks such as GRMN and NVDIA that have historically trended up in August, but the charts are dictating otherwise. Once again, market uncertainty reigns.
The US economy is showing signs of uncertainty as well. Corporations are keeping more cash than in the past, reportedly as a result of "scars" from the recession. Several companies also are reluctant to hire employees to fill empty positions. It was reported that US home sales, factory orders, and consumer spending are weaker than estimated. On a positive side, Exports have grown this year, but YTD have missed their estimated rate of growth by 0.1%.
Despite all of this uncertainty, corporate earnings continue to be strong. Many corporations are maintaining strong profits, and many are growing even in this uncertain climate. If I were a long term investor, I would definitely be loading up on stocks of strong companies with a weak stock price (GE, IBM, GOOG, etc).
Finally, of the stocks I watch, NVDA reports earnings on August 12th and SHLD reports earnings on August 19th. Both of these stocks historically head up going into their earnings reports.
There are a few stocks such as GRMN and NVDIA that have historically trended up in August, but the charts are dictating otherwise. Once again, market uncertainty reigns.
The US economy is showing signs of uncertainty as well. Corporations are keeping more cash than in the past, reportedly as a result of "scars" from the recession. Several companies also are reluctant to hire employees to fill empty positions. It was reported that US home sales, factory orders, and consumer spending are weaker than estimated. On a positive side, Exports have grown this year, but YTD have missed their estimated rate of growth by 0.1%.
Despite all of this uncertainty, corporate earnings continue to be strong. Many corporations are maintaining strong profits, and many are growing even in this uncertain climate. If I were a long term investor, I would definitely be loading up on stocks of strong companies with a weak stock price (GE, IBM, GOOG, etc).
Finally, of the stocks I watch, NVDA reports earnings on August 12th and SHLD reports earnings on August 19th. Both of these stocks historically head up going into their earnings reports.
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