Whipsaw Territory

While there is lot of excitement in technology stocks, the market is essentially stuck in whipsaw territory for long time since Thanksgiving. The market is crawling at a slow pace.
Many of the technology stocks which are bouncing on earnings news are not likely to immediately start rallying vigorously. Most of them have poor relative strength. So for most rallies in them will offer better entry options somewhere down the road.So unless the holding period is long better opportunities still are in stocks with high relative strength breaking out or unknown stocks breaking out on earnings. TDG, TransDigm Group Inc. was one stock which I had on my morning radar and traded it.
TDG,TransDigm Group Inc (Google Yahoo Earnings Chart)

Unlike the other earning related plays I like it has higher float of 44 million plus I guess it is going to use the good news to do some financial restructuring in terms of loan or secondary. That is one of the reason it might have pre announced the results. So I took lot off the position off at the end of the day but kept an extremely small tracking position. Many times companies use the earning good news to immediately come out with secondary and increase float, so you have to keep that thing in mind while playing earnings. Like TDG there were couple of other good lays for 2 plus point moves based on earning.
The most important thing in playing earning is to find unknown, neglected stock with low float or a blow out move. Many of you trying to learn the strategy (going by the email I have gone through) are picking well known stocks and stocks which have already moved a lot before earning. There is no surprise or discovery on them post earnings. Perfecting the earnings strategy takes around two quarters, so patience and systematic way to identify the candidates is the way to find those 20% plus post earning movers.

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