The Only Earnings Winner Setup You Need to Know
When you sign up for #AirApp price alerts, you're able to download and study the same alerts I use every day in my trading (I export them from my trading platform and import them into the app). Once properly understood (never blindly follow anyone.. have your own plan before you enter a trade), you can easily import these alerts into your trading platform and ride the same waves I do. After a bit of analysis, you'll determine that most of the alerts are set to trigger at or above the day 1 high.
This is because the "breakout over day 1 high" setup is by far the most lucrative pattern for swing trading earnings winners, and is perfect for those who are busy with day jobs, classes, kids, etc. It's also the same setup I traded over-and-over again to build my $25k account up to over $50k in six months, all while working full time at my day job. Between scanning, setting up alerts, and trading, I probably dedicate about 30 minutes to an hour per day to stocks. I don't have to babysit my positions, because this pattern is so reliable.
There are three time frames I like to watch for when looking to buy these breakouts, and I have a different strategy for each.
On the first day of the reaction, I'm looking for a stock to make new highs on the day (preferably in the afternoon), and 9 times out of 10 I'm selling before the end of the session.
Day 2 could go either way, which is why I rarely hold over night on day 1, and I'm looking to buy a morning spike (delayed or otherwise). I'll hold my position as long as it stays above the day 1 high or another important support level.
Breakouts that occur somewhere between days 3-10 are my favorite, and this is when most of the earnings winners with serious legs end up breaking out. I'll usually have a wider stop during this time period, because it is not uncommon for a stock to pull back 30-50 cents as it continues to digest the upward momentum. This also means that I'll take smaller position sizes, set a trailing stop, and let it ride.
If it's been more than 10 days since the initial earnings reaction, I still might consider buying, but a lot of the initial hype has probably subsided.
Below are a few charts that I've collected over the years (I have thousands), so you can study the price action and build on your pattern recognition. Developing a sound sense of pattern recognition will enable you to easily spot these trends in real time and integrate this consistently profitable setup into your trading repertoire.