9/28/2006

TRT -Trio-Tech Int'l anatomy of a trade


TRT -Trio-Tech Int'l

Now this is a trade I just closed when it spiked up by 1.80 today. I got in to this micro cap on Friday . It had blowout earnings and gapped up, I entered the moment I saw the earnings. I alluded to this stock in my post on Friday.
Noticing some good moves in telecommunication. China related stocks are also on fire. A good earning play is up over 40 % today


Look at the earnings.
Trio-Tech Int'l TRT 6/30/06 9,500.0 61.0% 705.0 1037.1% 0.22 0.02

It had a blowout quarter. Extremely small float and completely neglected stock. That is a potential mix for a blowout move. Every earning season there are plays like this. You have to be very quick in spotting them and getting in. When they move, they really move big time.

My bread and butter play is these kind of earnings plays. The earning season is a season of opportunity and I am looking forward to finding few more plays like these. If you focus on earning season you will find completely neglected companies with great earnings and then the market discovers them and they make significant moves. Over the last 5 years this is one strategy I have mastered and fine tuned in microscopic detail. Bulk of my profit come from such earnings related breakouts.

Another way to find these kind of plays is by using one of the ideas in the book I talked about last week- How Charts Can Help You in the Stock Market by William L. Jiler. The original genesis for this idea came from one of the chapters ( Chapter 6) in the book. While working on developing a scan for it I discovered most of these stocks make these move because of earnings.

4 comments:

Unknown said...

Interesting. I'm reading that book now but just started. Maybe I'll jump ahead tonight.

My question is, How do you get in these stocks after the earnings announcement but before the spike up. By the time I hear about them, the money has been made.

GT

Pradeep Bonde said...

You have to enter on the day of earning.
It will gap up on earnings but earning lead breakouts on low float stocks have legs. If you go through my old posts I have talked about this same thing many times.

Vladimir said...

Do you think it's wise to look for stocks with accumulation patterns leading up to earnings?

Pradeep Bonde said...

Does not matter. Most of these stocks are in such obscure corner of the market that no one is paying attention to them before earnings. I found NTRI at around 3 through earning strategy. NTRI was before earning trading way below the threshhold for daily liquidity. It was on Amex. There was no analyst covering it. It was owned by handful of mutual funds.

Look at GROW it used to trade below 10000 shares before it took off post earnings at around 6.

Look at HSR, it had days where there was 0 shares traded before its earning. Volume came only post earnings. It tripled in matter of weeks after earnings.