Action during earnings season always emphasizes our trading flaws and allows us to inspect what elements we may be missing in order to execute better trades. Our observations also get challenged and opportunity to sharpen our chart reading skills presents itself.
Start by observing the the chart and follow the trades throughout the day prior to and after market announcement. Then, observe how the stock reacts to earnings announcement. The next day see how both previous and earnings charts compare and observe the buying/selling interest volume. All these give you clues what the following days will do.
The digestion of earnings always has an initial reaction, a follow-up reaction and a continuation. Once you learn to observe these on the charts, it will help you find the direction for your next trade.
Happy Trading, Living and Dancing
The Daily Pick - TBA
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