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Tackle Today: Tesla and Microsoft Earnings

July 23, 2020

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Tools for options traders

Traders,

It is a busy news day on the earnings front with major stocks like Tesla, Microsoft, AT&T, Twitter, and others reporting their quarterly numbers.

Of most interest to traders will be Tesla and Microsoft.  Tesla has been the poster child for this market rally, seeing price gains of 60% in the last month, and the stock up over 500% year to date.  By posting profitable numbers for the fourth quarter in a row, Tesla is now eligible to enter the S&P 500.  It is the largest company in the history of the index to not be included, yet.

Microsoft, on the other hand, will give traders and investors insight into the $1.6 Trillion juggernaut.  When you analyze major companies’ earnings reports, you are not just trying to learn about that company.  With Microsoft, for example, traders will be watching the price reaction from one of the leaders in the market to see how well it holds up after a +52% year to date performance.

Earnings season is under way, and on a day by day basis, we are starting to get a better picture of how the market is responding to results.  As of now, 77% of companies have reported results above their expectations (which have been lowered in recent months).  This is up from 65% in the previous quarter and above long-term averages. We will be analyzing the numbers, the reactions and the market response in our Halftime Report daily.  Join us at 12:30 pm EST live: https://www.youtube.com/c/TackleTradingTeam

#TeamTackle


Chart of the Day

Tesla Daily Chart

Tesla reported earnings on Wednesday after the market close.  The price has held up well, trading near $1600 a share in early trading on Thursday.  What has not held up well is the Implied Volatility for the options on Tesla.  When IV drops, the value of an option drops at the rate of Vega.  If you hold options you must learn how to read implied volatility changes.


Video of the day

Meet the Options Greeks

Coach Tyler Craig teaches #TeamTackle about the Options Greeks: Delta, Theta, Vega and Gamma.  Watch the replay here.


Traders Lounge 11 AM EST

Join the coaches in this live lounge, ask questions, discuss ideas or just sit back and listen to veteran traders discuss market conditions.

Cashflow Club 8:30 PM EST

Held every Thursday before Friday’s option contract expirations, this show helps you perfect your favorite cashflow strategies.

Halftime Report 12:30 PM EST

The Halftime Report starts at 12:30 EST and covers what news is driving the market, chart analysis from the movers and shakers of the day and fun in a way that only Matt and Tim can deliver.


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