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Netflix (NFLX) has a consistent track record of rising into earnings, so we will pursue an options trade today. Some of the members already started this trade on Tuesday, so an add makes sense.
Look at the weekly 365.00 calls (Delta 50) that expire Friday (3) days. We would like a flag or ABCD pattern intraday for new entries.
Also note annual sales and earnings in the left panel, as the company continues onward and upward. 2.68 in 2018 vs. estimates of 4.08 this year. If this keeps up, management is doing it’s job of managing accelerated growth. Share prices should head back to recent highs.
We talked about a trade on FedEx yesterday. Refer to that blog post as the stock trades higher (+1.00) this morning.
Futures are higher (+6.62) SPX ES 2869.12.
Over the past 8 quarters, NFLX rallied into the earnings release 7 of 8 times. Only 1 occasion was the trade flat, for no gain. While this isn’t a guarantee, it certainly points to decent probabilities.
All of the comments herein assumes markets do not
Join us today in the trading room for our LIVESTREAM broadcast during market hours, as we trade NFLX and other new positions. Watch, listen and trade from 9:20 AM to 4:15 PM Monday through Friday.
Happy Trading,
Vinny
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