Tuesday, July 21, 2009

IN THE HUDDLE

EARNINGS SEASON
We typically see great two way action with earnings season. This is a perfect environment for day traders.' We don't have to "call" the market. The funds are either buying or selling and it is very obvious.
Today CAT had earnings before bell. It gapped up higher and some guys' made money. I think the easy money was shorting it right before lunchtime when CEO on conference call said we still could lose money in Q3. Everybody and their grandma was long CAT. The CEO forced everybody to scramble and cover. It was a slow methodical sell-off. Lower lo's and lower highs.
Speaking of lower low's....You see the ESI 5 minute chart late in the day? Higher highs and higher lo's. SLM headline came across so i immediately looked at the educators. This is a great risk reward scenario. You can risk till ESI takes out previous candlestick bar (5 -minute). If you are right it keeps on making higher highs and you have no heat.
Make sure to set your alerts before the bell on your earnings plays. It also helps to have other traders' in the room with you. It is impossible to keep track of all the earnings stocks, especially on the open. TradingRM has a real-time chat that let's outsiders keep track what is moving and what our traders' have on.
Till next time, Don't get sacked!

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