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Options Theory Blog: Finding Trades After Earnings

July 29, 2022

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Come learn how I find trades AFTER an earnings gap.

Notes: Finding Post-Earnings Trades

Key Points

  1. Earnings announcements are catalysts for new trends. They can be a gift that keeps on giving.
    1. More likely we get breakaway gaps or runaway gaps than “gap n crap.”- Market rejects the earnings move and it fully reverses, in other words.
    1. Most compelling earnings gaps are those that break major resistance. It catches bears off guard.
  2. Bull Trade Timing
    1. Enter on the day of the gap if we get signs it’s continuing. Intraday chart continues to show strength. Trigger Idea: Buy above 5-minute high.
    1. Wait for secondary patterns. Buy the first pullback, buy the first flag, buy the first breakout after a pause. They’ve all seen INCREASING MOMENTUM on their uptrends.
  3. Strategy Selection
    1. Aggressive: Higher reward/lower POP = bull call spread
    1. Conservative: Lower reward/higher POP = Bull put spread/Naked put with scaling in

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One Reply to “Options Theory Blog: Finding Trades After Earnings”

  1. MistySuggs says:

    Thanks Tyler. Great to have more tools in the earnings toolbox.

Comments are closed.

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