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.

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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.

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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.

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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.

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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).

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Gartner Inc. (IT)

I have entered a shares position using shares on IT, which publishes earnings on Feb.1. My intent is to exit by Jan. 31.

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1/22 – 3:20 p.m. New York time

In outcomes, I entered shares positions on CTLT and IT and exited an options position on LVS.

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First off, a giant caveat. The shut down of the U.S. government that began Saturday may have an impact on reporting. Until Congress reaches a deal on funding the government, everything is up in the air.

If things proceed as planned, the first gross domestic product numbers detailing the 4th quarter will be published on Friday at 8:30 a.m. New York time, simultaneously with another major report, durable goods orders.

Two real estate reports will be released: existing home sales on Wednesday and new home sales on Thursday, each at 10 a.m.

Also out, international trade in goods on Thursday at 8:30 a.m.

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Ethan Allen Interiors Inc. (ETH)

ETH, which publishes earnings on Jan. 24 before the opening bell, a day ago turned up on the Fisher Transform metric as applied to the four-hour chart, and the daily chart is moving in the direction of an upward trending metric.  I entered a position using shares with the goal of exiting prior to the earnings announcement.

ETH gave a downtrend signal on the 3-hour Fisher Transformer on Jan. 23, the last day to exit prior to earnings, and exit I did, for a loss. Shares declined by 0.19% over for days for a -17% annual rate.

sym	entry	exit	result ($)	result (%)	entry date	exit date
ETH	27.00	26.95	-0.05	-0.19%	1/19	1/23
	zacks rank	zacks esp	FisherTrans (day)	FT cross (4 hour)	earns est.	earns actual
	2	0.68	-0.63	1/18	0.52	TBD

By Tim Bovee, Portland, Oregon, Jan. 19, 2018

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1/19 – 3:20 p.m. New York time

In today’s outcomes, I entered one position, ETH, and exited none.

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Las Vegas Sands Corp. (LVS)

Update 1/22/2018: With earnings two das away, LVS gapped up at the opening bell, as it had the first day of the week before, and the week before that. This week Monday’s opening price was $1.53 above Friday’s close, bringing my options position into profitability. I exited at 43.6% of maximum potential profit, with the Fisher Transform metric still uptrending on both the daily and 4-hour charts.

Shares rose by 3.2% over my four-day holding period, or a +294% annual rate. The options position produced a 77.5% return for a +7,059% annual rate.

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I have entered a  bull put vertical spread on LVS, using options that trade for the last time 15 days hence, on Feb. 2. The premium is a $0.94 credit and the stock at the time of entry was priced at $74.18.

I made the decision to enter the trade in my account based on an uptrend on the Fisher Transform metric and a high earnings surprise predictor score (ESP) of 2.16% from Zacks. 

The profit zone for this position is $71.97 and up.

LVS publishes earnings on Jan. 24 before the opening bell.
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