3 Ways to Bank Trading Earnings

Here are three battle-tested stock earnings calendar strategies that have generated triple-digit annual returns for me in the past.

You’ll find a profitable post-earnings announcement drift strategy in addition to a reliable earnings winner setup.

Any trader with basic technical analysis skills can immediately integrate these strategies into their trading repertoire and make money with little effort.

Post-Earnings Continuation Breakout

This strategy is a basic support/resistance setup that I have used for both momentum-based day trading, and swing trading.

The concept is pretty simple: locate and buy momentum stocks as they break out over their earnings day range.

This is a great strategy for part-timers because you don’t need to be glued to your computer. Just scan for these setups every night and set a price alert in your trading platform.

Here is a visual representation, annotated with a few of my trade-signal indicators.

Post-Earnings Continuation Breakdown

This is the inverse of the previous strategy. Simply short the stock as it’s taking out earnings day support.

Because an earnings event is a catalyst for momentum, I like to short every time the stock consolidates and breaks down post-earnings.

This strategy works best on stocks that have huge losses on earnings day so I tend to set my screens at “Earnings Day % Change From Open < -10”.

Here’s an example:

Pre-Market Range Breakout

The pre-market range breakout strategy begins with a stock opening higher than the previous day’s close on earnings day.

These typically attract strong volume during the pre-market session, and in turn produce a sense of support and resistance. We can use this range as a guide once the market opens.

The key here is to buy early in the day as momentum pushes the price up over the pre-market high.

Using $CDMO as an example, I’ve drawn a line at the top of the pre-market range. I would use that as my entry point.