With earnings season just starting, it’s an interesting time for the markets.
Ross Givens calls it a “wildcard” – as earnings strength could move markets in unpredictable ways.
With that said, let’s see how markets have been moving.
The Daily Direction
Note: With all indexes closing higher yesterday, the short-term direction for the S&P 500 and the Dow – as well as the long-term direction for the Dow – flipped back upwards.
The Daily Nugget
The better you understand what the market expects, the more effective you’ll be as a trader.
As we’ve said many times before, markets trade on expectations…
And earnings season is a chance to really see this in action.
A company’s earnings may be objectively “good” – but if it’s below expectations, its stock price will still likely fall.
And likewise, a company may post objectively subpar earnings – but if it’s above expectations, its stock price will likely rise.
That’s why the better you understand what the market expects (and we’re not talking just about earnings)…
The more effective you’ll be as a trader – because you can trade off those expectations.
Case in point – the market almost never expects certain stocks to surge…
But often they do anyway, because of the X-factor – institutional buying…
Meaning if you know how to spot their tell-tale signs, you could jump in right alongside them for a quick profit.
And thanks to Ross’ experience working for one of the biggest institutions on Wall Street…
He’s developed a strategy for spotting these secretive institutional trades…
The Traders Agency Team