Market’s a little choppy. The Nasdaq is up a little bit.
We’re seeing a lot of varying reactions to earnings.
Some investors are shrugging off negative earnings. Other stocks are popping.
And the weirdest one: In the case of CAT, they beat earnings estimates — but the stock went down!
Yes, earnings can be unpredictable, but if you ever want to protect yourself, you just need to remember one thing: Married Put.
I recently held a free class on how I use them. You can go here and watch it on demand.
Anyway… back to CAT and the disastrous earnings overreaction:
What’s up with that? Well, when you see an “opposite” reaction from what you might expect based on the numbers…
It’s usually because of one thing: Guidance.
That’s what they call the less glamorous part of the earnings report.
It’s where the company tells investors not what happened last quarter… (those are the numbers)
But what they see coming in the future.
And a lot of times even though the earnings report might say something positive, the Guidance might give some bad news.
So that’s usually when you’ll see a stock go down despite positive earnings numbers.
As I mentioned before… I cases like this, where I’m trading a trending stock but it’s going into earnings or some other choppy period…
I like to use a specific strategy called the married put. Basically, it acts like a safety net for your trading.
In markets like this, everyone needs a safety net.
Remember to go watch my class and you’ll also learn how to only trade confirmed trends.
Trade well,
Jack Carter
