Quarterly results period is one of the best opportunities to earn handsome income from the Stock market. And in order to achieve that, people generally rely on the analysts to feed them with the hidden secrets behind the result. But it cannot be called hidden if the whole herd is following it, isn’t it? So, let’s discuss 10 key secrets to determine stock moves after results. Using these you no longer need to depend on so-called elite analysts and make your move yourself.
Check out Market Trend
Individual stock’s behavior is generally unpredictable. However, it is not so difficult to understand the entire market trend. All you need to look for the weekly or monthly chart pattern and you will have a whole market trend idea. Do not forget to spot out whether it is a ‘bullish trend’ or ‘bearish trend’. Even if a company does wonders in the result, the stock move may not be significant if the overall market trend is bearish.
It is important to track down the stock’s history of earnings move just after the result. Although the whole of it might not be of great help, it can be helpful if you just concentrate over the most recent quarterly earnings.
Prior to result move
Another important aspect is to track down stock’s price movement before the result. It provides with a good clue on how the stock price might move after the result. You might not know this, but a certain pre-earning move can be the reason behind the stock falling even after a good result and the reverse situation can happen too.
Short interest is a great indicator to gauge investor sentiments before or after the result. It is the number of shares that investors have shorted but not covered yet. Accumulation of short interest indicates that the stock price is most likely going to fall.
Tight trading range
Tight trading range is another occurrence that happens after the result and you need to be extra careful while dealing with it. Just keep an eye on the tight trading range and take positions only on the breakout of range. Remember that range breakout can be on upper as well as the lower end of the range, so it is better to be a little cautious.
Stake of big investors
It is quite evident that the big investors or the promoters get first-hand information about a company after the result and small investors are the last ones to know it. So, it is better to keep track of the big investors because it the can earn you some good profits
Support and resistance level
If you ask me the best among 10 key secrets to determine stock moves after results, then this is the one. the All technical analysts would agree that charts speak more than anything. So its better to keep a close eye on support and resistance levels. If a stock is already trading at a resistance level and the result is bad, then you can anticipate a big fall. Vice versa is also true.
We wouldn’t say to not follow stock analysts at all. Rather it’s better to listen to all of them and form your opinion, don’t just blindly trade on their recommendations. Some of them can be on the bullish side and some of them on the bearish side. You need to estimate a middle ground from all their opinions.
Current valuation of equities
The current valuation of equities is an important fundamental parameter to look for. It’s better to select low valuation equity because mostly high valuation equity grabs a free fall after the result.
Future earning guidance
This is one thing you should listen carefully in the quarterly earnings announcement. Even if the revenue or profit is at par level, a good future earning guidance can lift stock prices to a higher level.
Also Read: How to pick stocks for Intraday Trading?
If you consistently follow these 10 key secrets to determine stock moves after results, your success ratio is going to increase for sure. All 10 of them may not be relevant always, but they should be a part of your checklist. So keep a note of these and start following them when the next quarterly results are out.