Risky Pre-Earnings Play ~ SHORT~
Hey everyone!
Let's make an analysis for a potential pre-earnings trade on SNOW. This is very risky so we have to be extra careful and analyze the price action until the last trading session before earnings report. I have made a successful trade on the previous earnings report. My entry was at $128 during the trading session the day before the earnings announcement and my exit was at the next day at the open at $165 (almost 29%). I took that trade because the stock price had broke out from the downward channel, a week before the report (see in graph), so in my analysis going long before the report was a good idea (and thank god yes, it was).
For our new proposed short trade we have the following:
1) There is some pattern (seasonality) that unfolds during the period NOVEMBER to FEBRUARY. As you can see, price has increased from NOV 2023 to FEB 2024 by approximately 37%, while a quite similar behavior is observed from NOV 2024 to FEB 2025, but the increase is greater (approximately 52%)
2) In both cases, before earnings announcement there was a consolidation period. However, the "jump" in price was far greater in the last earning report (NOV 2024), but the following weeks the price was not increasing at such a fast rate when comparing with the period from NOV 2023 to FEB 2024
3) RSI had almost the exact behavior in both cases. It was near the overbought territory before the earnings report, jumped higher after the announcement, then fell in a quite similar way till it reached 50 and then grew once again to the upper level (70)
4) Current price levels were resistance levels back in 2023 and support levels from Q4 2023 to Q1 2024
5) As you can see in the upper left rectangle, the price retraced in previous levels. I am not saying that this will happen again, since that implies a drop of nearly 30%, but I can see the price falls between $155-$160 level.
6) Market sentiment is not that good for tech stocks the last couple of days and let's admit that valuations are quite high. Even if companies announce great results, market finds a small thing to overreact and send the stock price the opposite way
Having all these in mind I am "guessing" on a 10%+ decrease in share price.
I'll keep watching SNOW until the announcement. This was an analysis that seemed interesting (at least in my head).
Happy to discuss on this!!
Not a financial advice!
Let's make an analysis for a potential pre-earnings trade on SNOW. This is very risky so we have to be extra careful and analyze the price action until the last trading session before earnings report. I have made a successful trade on the previous earnings report. My entry was at $128 during the trading session the day before the earnings announcement and my exit was at the next day at the open at $165 (almost 29%). I took that trade because the stock price had broke out from the downward channel, a week before the report (see in graph), so in my analysis going long before the report was a good idea (and thank god yes, it was).
For our new proposed short trade we have the following:
1) There is some pattern (seasonality) that unfolds during the period NOVEMBER to FEBRUARY. As you can see, price has increased from NOV 2023 to FEB 2024 by approximately 37%, while a quite similar behavior is observed from NOV 2024 to FEB 2025, but the increase is greater (approximately 52%)
2) In both cases, before earnings announcement there was a consolidation period. However, the "jump" in price was far greater in the last earning report (NOV 2024), but the following weeks the price was not increasing at such a fast rate when comparing with the period from NOV 2023 to FEB 2024
3) RSI had almost the exact behavior in both cases. It was near the overbought territory before the earnings report, jumped higher after the announcement, then fell in a quite similar way till it reached 50 and then grew once again to the upper level (70)
4) Current price levels were resistance levels back in 2023 and support levels from Q4 2023 to Q1 2024
5) As you can see in the upper left rectangle, the price retraced in previous levels. I am not saying that this will happen again, since that implies a drop of nearly 30%, but I can see the price falls between $155-$160 level.
6) Market sentiment is not that good for tech stocks the last couple of days and let's admit that valuations are quite high. Even if companies announce great results, market finds a small thing to overreact and send the stock price the opposite way
Having all these in mind I am "guessing" on a 10%+ decrease in share price.
I'll keep watching SNOW until the announcement. This was an analysis that seemed interesting (at least in my head).
Happy to discuss on this!!
Not a financial advice!
Publications connexes
Clause de non-responsabilité
Les informations et les publications ne sont pas destinées à être, et ne constituent pas, des conseils ou des recommandations en matière de finance, d'investissement, de trading ou d'autres types de conseils fournis ou approuvés par TradingView. Pour en savoir plus, consultez les Conditions d'utilisation.
Publications connexes
Clause de non-responsabilité
Les informations et les publications ne sont pas destinées à être, et ne constituent pas, des conseils ou des recommandations en matière de finance, d'investissement, de trading ou d'autres types de conseils fournis ou approuvés par TradingView. Pour en savoir plus, consultez les Conditions d'utilisation.