How (and what) I’m trading before big tech earnings
Aug 11, 2021Good morning!
The markets are down in the early going during a very heavy and very interesting earnings week. That’s not a sign of weakness like so many think.
It’s simple profit taking.
Here’s my playbook.
1 – A quick counter-trend trade idea
The pattern has been very consistent for the past few quarters with big tech stocks. Run up into earnings, report blowout numbers, then fall back. I have no idea if that holds but this is a great counter-trade opportunity if it happens again.
Learning to “fade” the trade everybody else is taking can be a super-powerful way to boost your returns around core positions. It takes practice and you’ll make plenty of mistakes while you learn, but the results can make it worth the effort!
The trade’s already worked this morning for Tesla which is down 2.4% after blowout earnings. It’s also already worked for a quick trade I sent to the One Bar Ahead™ Family earlier today.
2 - Tesla tops $1b in income
Tesla reported earnings yesterday and absolutely blew through estimates by a whopping 47%. It was also the first quarter Team Musk reported an income of more than $1 billion, up 10X from a year ago.
Repeat that with me … 10X!
Many folks are worried about supply chain issues but that’s overblown. If there’s anybody who is ahead of the game, it’s Musk.
I hope I am smart enough to buy more shares!
3 - Robinhood reminds me of WeWork
Robinhood is in the middle of their pre-IPO “roadshow” – a time during which the company attempts to generate hype and interest from the investing community, analysts, and the retail public. Yet, I can’t help but notice that Robinhood is hiring former SEC employees and that execs seem to be dodging questions related to angry meme stock investors and outages.
All is not lost though, we learned from the company’s virtual roadshow event that Pluto is CEO Vlad Tenev’s favorite planet.
Ummm...
4 – That’s one way to beat inflation
Many Americans are struggling to make ends meet so you can imagine my surprise when I heard about the $200 French fries being served by Serendipity 3, a restaurant located in Manhattan’s Upper East Side.
That’s one way to beat inflation. Apparently, these things are sprinkled with edible gold and seasoned with truffle salt and served on crystal with an orchid, more truffles, and a Mornay-cheese dip.
More power to ‘em if they sell (and I hope they sell a lot).
Meanwhile, I’m going to stick with McDonald’s fries (and stock).
5 - The greatest threat the US has ever faced
This from CNBC…. “China’s digital yuan could pose challenges to the US dollar”.
Then I thought to myself, “Gee, where have we heard this before?” Oh, I dunno … One Bar Ahead™ several months ago. Still, it’s great to have company!
Billionaire Kyle Bass agrees with me, by the way.
Bottom Line
Many people want to improve their lives but very few choose to do so. Life isn't something that just happens.
MAKE it a great day!
Profits will follow.
You got this – I promise!
Keith
