Hey trader,
On Wednesday, one stock on my earnings watch list jumped 15% after its report. I passed without reading a word of the earnings.
A move like that pulls on you. The longer you watch it, the more your excitement starts making the decision.
That’s why I run three filters before any trade.
They check a stock’s price, its trend and whether the chart shows me a clear direction. The 15% stock failed the very first one.
Anything that fails gets crossed off, however good it looks.
That keeps my money in setups where I can plan my entry and my exit before I get in.
I hold Dunk Alerts to the same standard. I’d rather send you fewer trades that pass my checks than fill your phone with noise.
On Wednesday, these filters cut my earnings watch list by more than half.
Here’s how each one works, so you can run them on your own earnings watch list.
Filter 1: The Price Check on My Earnings Watch List
My first filter takes about two seconds. I don’t trade stocks priced under $10.
I’d rather see a price above $25.
Wednesday’s 15% mover was a very low-priced stock. I had nothing to say about it as an earnings play.
Three more names on my list traded at $11, $14 and $2. I crossed them off without a second look.
Six of the 15 stocks on my earnings watch list never made it past this filter.
I set that rule long before Wednesday’s open. A 15% jump on my screen doesn’t change it.
Filter 2: The Direction of the Trend
My second filter asks which way the bigger trend points. I check it on the daily and weekly charts before I think about the report.
Two stocks on my earnings watch list ran into trouble here.
CBRS was in a downtrend going into its earnings. I had no idea what the numbers would do to it.
Buying it would have put me against the trend. I left it alone.
ENS had a different version of the same problem. It had already taken a significant drop before its report that afternoon.
If the market liked those earnings, I’d watch for positive price action. I’d still need to see a market turning point before I trusted that the drop was over.
Brookfield showed me the other side of this filter. It made a really nice turnaround on the weekly chart, and its daily chart looked bullish.
Filter 3: Whether the Chart Talks to Me
I ask whether the chart is talking to me. Two more names on my earnings watch list failed this one.
YETI’s weekly chart was moving sideways. Its daily chart didn’t tell me anything either.
When a stock doesn’t talk to me, I leave it alone.
FIGR was sideways on both timeframes too. At a market turning point, I like to see divergence on the Awesome Oscillator, which is a momentum indicator.
Divergence shows up when price makes a new low while the oscillator makes a higher low. FIGR didn’t give me much of that.
A sideways chart leaves me without a direction. Without one, I can’t plan my entry, my profit target or the level that proves me wrong.
How I Turn My Earnings Watch List Into a Plan
Four stocks on my earnings watch list stood out after my filters: Brookfield, Twist Bioscience, Applied Materials and Cisco.
Passing my filters earned them a plan. It didn’t earn them my money yet.
Each one came with a condition I want to see first:
- Brookfield: I’d look to buy a pullback into the sweet spot where my Structure Channel meets my Swing Bands.
- Twist Bioscience: It’s in a strong uptrend with a nice correction. I want the Awesome Oscillator back at the zero line on the 4-hour chart before I buy.
- Applied Materials: It printed an engulfing candle, a reversal candle that swallows the one before it. I want to see how it handles the Fibonacci levels above.
- Cisco: It looks like it may have seen its lows, but Friday’s earnings move may change that. I’m watching for a move up into its Fibonacci area.
My Structure Channel tracks the bigger trend, and my Swing Bands track the shorter swing. Those conditions keep me from buying any of these four on excitement alone.
You can run these filters on your own earnings watch list tonight. Set a price floor, check the bigger trend and pass on any chart without a clear direction.
Whatever survives gets a condition before it gets a trade.
I moved past Wednesday’s 15% pop quickly. A setup can get my attention without getting my money.
Let Me Do the Filtering for You
The hardest part of this process is finding the right stock before the window closes. My Dunk Console scans 4,782 markets, and I run every candidate through my checks myself.
You only hear from me when I actually take the trade. Here’s what lands on your phone when one qualifies:
- Two ways to trade it: You get a stock play and an options play, each with my entry, my target and the plan for the trade.
- Four ways to get it: Every alert arrives by app notification, text message, email and in the Dunk Room, so you never have to watch the market all day.
- A short hold: You’d typically hold a trade for a couple of weeks, which means no day trading.
- A follow-up when I exit: You get another alert when I close the trade, at my target or early.
From June through October, I logged 16 dunk trades, and 12 of them were winners. I show every one, losers included, and past results don’t guarantee future results.
You’re also covered by a 90-day money-back guarantee. It’s a one-time purchase with no auto-billing and no auto-renewal.
The Black Friday launch price ends Wednesday, Dec. 9, at 2 PM ET.
Send me the next trade that passes my checks
Jody Samuels
Queen of Quid
