TWTR Analysis

January 25, 2018January 26, 2018 Tim Bovee2 Comments

Update 1/26/2018: TWTR’s Fisher Transform metric reversed to uptrending and, in line with my current guidelines, I exited immediately. The trend change puts TWTR’s trend at odds with a strong negative earnings surprise predictor from Zacks of -11%.

Shares rose by 4.3% over one day, or a +1,569% annual rate. The options position produced a -30.4% loss for a -11,109% annual rate.

Seeking Alpha posted this take on the reversal: Twitter gains while analysts face COO departure.

In traditional chart analysis, TWTR’s decline was a fall from a double top, and double-top lore put support at $21.53. TWTR’s low before the the reversal took wind was $21.04, so it fell short of the mark by 51 cents.

I have entered a bear call vertical spread on TWTR, using options that trade for the last time 15 days hence, on Feb. 9. The premium is a $0.32 credit and the stock at the time of entry was priced at $22.33.

I made the decision to enter the trade in my account based on a negative earnings surprise predictor from Zacks of -11.0% and a downtrend from the Fisher Transform metric.

TWTR publishes earnings on Feb. 8 before the opening bell.

Live: Thursday, Jan. 25, 2018

January 24, 2018January 25, 2018 Tim Bovee

1/25 – 3:15 p.m. New York time

I entered four earnings plays today, using options on TWTR and shares on K, MDSO and MPW. I exited EGN for a loss.

Shares: EGN and MTW

January 24, 2018January 30, 2018 Tim Bovee3 Comments

Energen Corp. (EGN)

The Manitowoc Co. Inc. (MTW)

I entered two bullish earnings plays using shares, on EGN and MTW. The entry is based on an uptrend signal on the Fisher Transform metric and a high expectation of an earnings surprise.

EGN publishes earnings on Feb. 8 before the opening bell and MTW, on Feb. 7 after the market close. My intent is to exit the positions before earnings are published, relying on the Fisher Transform to signal when I should exit.

EGN moved to a downtrend as signaled by the Fisher Transform shortly after entry. I exited on Jan. 25 for a loss. A Fisher reversal occurred on Jan. 30, and I exited MTW, also for a loss.

Live: Wednesday, Jan. 24, 2018

January 23, 2018January 24, 2018 Tim Bovee

1/24 – 3:25 p.m. New York time

I entered two earnings plays using shares and exited two. The entries are EGN and MTW, and the exits — held for two days — are CTLT and IT,

I analyzed ANTM in part but once I calculated the wide bid/ask spread, I declined the trade without a full analysis.

I posted my pools of options (nine symbols) and shares (23 symbols) earnings plays that I shall be analyzing from for the next week

HAS Analysis

January 23, 2018 Tim Bovee1 Comment

Hasbro Inc. (HAS)

I have rejected a short bull put spread on HAS, using options that trade for the last time 17 days hence, on Feb. 9. The bid/ask spread was very high — greater than 100% — and as a firm rule I don’t trade such illiquid assets.

Here’s the analysis that got me to that decision:

I made the decision to analyze the trade in my account based on a downtrend beginning Jan. 16 as measured by the Fisher Transform metric and a bearish rank and a negative score of -3.87% on the earnings surprise predictor from Zacks.

HAS publishes earnings on Feb. 5 before the opening bell.

FB Analysis

January 23, 2018January 30, 2018 Tim Bovee2 Comments

Facebook Inc. (FB)

Update 1/30/2018: FB turned to the downside on the Fisher Transform metric, and I exited for a profit. The drop coincided with a general decline in blue chip stocks.

The signal came a day before the mandatory date of exit required to avoid the earnings announcement.

Shares declined by 1.2% over seven days, or a -61% annual rate. The options position produced a -19.5% loss for a -1,015% annual rate.

I have entered a short bull put spread on FB, using options that trade for the last time 17 days hence, on Feb. 9. The premium is a $1.78 credit and the stock at the time of entry was priced at $187.35.

I made the decision to enter the trade in my account based on a positive earnings surprise predictor of 2.04% and a bull rating from Zacks and an uptrend signaled Jan. 22 by the Fisher Transform metric.

FB publishes earnings on Jan. 31 after the closing bell.

Live: Tuesday, Jan. 23, 2018

January 22, 2018January 23, 2018 Tim Bovee

1/23 – 3:30 p.m. New York time

I entered an earnings play on FB using options and exited plays on ETH and PGR using shares.

I analyzed HAS as a potential options position as it approaches earnings, but declined the trade.

Shares: CTLT

January 22, 2018January 24, 2018 Tim Bovee2 Comments

Catalent Inc. (CTLT)

I have entered an earnings play using shares on CTLT, which publishes its earnings report on Feb. 5 before the opening bell.

I exited a few days after entry on a trend shift to the downside on the 3-hour Fisher Transform metric. The position produced a 5.9% return over two days, or a 1,080% annual rate.

Trade Selection

January 22, 2018 Tim Bovee1 Comment

Regular readers will have noticed that I have made significant changes in how I select trades over the last month or so. Here’s my method as of January 2018.

I’m looking at three metrics: The Zacks earnings surprise predictor (ESP) and the Zacks rank to assess the professional analysts’ opinion of the stock’s prospects, and the Fisher Transform trend metric to assess the trend, up or down, which is as indirect way of assessing trader and broader public sentiment. For this method, the Fisher is uptrending if its present level is higher than its one unit prior level on the daily chart and downtrending if the present level is below the one before. The trend is given on my spreadsheets as a 1 (uptrending) or a -1 (identical or downtrending).