A hint to make more this earnings season

After the close SMB met in its training room for a talk led by me. I haven’t given many talks of late but I thought the desk was due for one after my observations of their trading. It is earnings season. There are tricks to scoring. And there are things traders do to harm their results.

Trying to hard is a common thief of the ambitious earnings season trader. Then there is Mr. Spread-too-thin. Followed by Miss-I-am- too-small in my best set ups. Let’s not forget Chief-I-am-too-hard-on-myself. Do you want to make more this earnings season? Try this. Just be bigger in the stocks that have picked a clear and clean direction intraday and follow the trend with size.

Of course there are other set ups to master that will help you make bank. But let’s add some reality to your trading please. Master what is easy first and then climb higher. Make sense?

After our discussion and the close a bright new trader sent me his review (below). See how he reviews his work. Notice how he focuses on how to get bigger in the easiest of plays. This is firstly how you make more money during earnings season.

Decent start for the Q2 earning season. Sized up in good risk/reward entries and plays that made sense to me. However, I could have been even bigger in several occasions next time.

1) BAX, 55 at 9:48am.

This was a great place to get up like 500-800 shares and keep some really tight against 55.02. BAX held 55 offer, stock was beaten down and gap down. I only shorted 300 shares. A place to get really big and make a lot more. I was thinking to add later, but this was the best place to get really big aggressively and responsibly.

2) HALO, 9 at 9:39am.

This was an excellent entry to get pretty big. I missed this entry in HALO when I was focused on trading C at 25c level. I checked back with HALO later on, seller stepped down to 8.70 and pressed the bids. This was the place to get pretty big. I only got up to 400 shares because I had missed the first best entry at 9 and I want to keep it a little bit cautiously down at 8.70. This was the same trade from 9. Should be as big as 800 shares and keep some tight stops against 8.71.

3) MAT, 31 at 1:49pm.

I was slipped on the open in MAT. I got up to 300 shares against 31.85 buyer looking for a drive to 32.40. Liquidity was extremely poor and I printed 25c below 85c in MAT and really got hurt. Therefore, I became really cautious trading MAT later. However, I must notice that MAT was much more stabilized at 31 and very controlled and stabilized. risks was 6-10c. I could have gotten at least 400-500 shares instead of 200 shares I shorted with 30.92 average against 31.06.

Good thing I was bigger in several plays I liked today. I need to think about getting even big, and if risk/reward is great and trade is clean, I need to think about getting up to 800-1200 shares while controlling my risks.

Several stocks I will be paying attention tomorrow:

1) GS: Look to establish positions against good levels after 10:45am. Stay smaller.
2) JNJ: Market stock sort of. Want to be positioning myself more than tick trading.
3) STT: Had really good drive in Q1 earning season. Will see if that repeats again.
4) KO: Nice drive in Q1 as well. Orders can be bigger, so want to see how levels were respected first.

Current theme in the market:
1) choppy open (longer price discovery) and trend later in the day when stabilized
2) profit taking in SPY
3) seeing several profit taking, sell the news moves (ex: JPM, WFC)