The Power Earnings Gap Earnings season gives birth to opportunities that can last for weeks or even months beyond the day the data is released. In fact, one of our five main strategies is called the “Power Earnings Gap.” We didn’t invent this strategy, but through more than a decade of trading experience, we’ve found it to be one of the most effective. What is a Power Earnings Gap? Most companies in the U.S. market report earnings four times a year, once each quarter. Earnings season doesn’t have an official start and end date, but it typically stretches over 6–8 weeks as thousands of companies report. During this time, you get a direct look at how businesses performed financially and...
Many enter the market with big hopes to beat the odds and be successful in the long run, but they’re approaching things the wrong way. Colorful charts and candlesticks suck foolish investors in and make them think they need to recognize patterns in order to make profits, but that alone can’t be it. You must raise your probability of success using financial analytics and information, while also applying general technical analysis to your trades. He with the most information wins...rather than staring at charts for hours, you should consider studying the three financial statements: Income Statement Balance sheet Cash Flow Why study these? Because you have to remember that at the end of the day, the stock market is about...
What is a Short Squeeze? A short squeeze happens when a heavily shorted stock, meaning many investors have bet it will fall, is suddenly propelled upward. Short sellers must buy shares to cover their positions, causing the price to spike further. This can trigger a rapid, self‑reinforcing rally $OPEN: A Prime Case Study Over the past month, $OPEN surged 500%, with a jaw‑dropping 170% in just five days. Here's what fueled the squeeze: High short interest: Around 19–25% of the float was shorted, a red flag for vulnerability. Retail frenzy on social media: Posts on Reddit’s WallStreetBets, StockTwits, and hash-viral tweets about Opendoor sparked unprecedented buying momentum. Speculative option flows: A surge in call option activity added leverage and volatility,...
What is a Short Squeeze? Let’s take a closer look at short-selling, a strategy that allows traders to profit from a stock's decline. Short sellers make money by “shorting” stocks they believe are overvalued or poised for a downturn. Here’s how it works:When you short a stock, you first "borrow" shares from your broker (e.g., through platforms like Robinhood or Schwab) at the current market price. The goal is to repurchase the stock later at a lower price, return it to the broker, and pocket the difference. For example, let’s say after conducting thorough research, you identify a stock priced at $100 that seems overpriced and likely to drop. You can borrow shares of this stock from your broker and...
