Earnings Season Best Trade: Google
Hi everyone and welcome to the Yellow Tunnel community, an aggressive short-term trading service dedicated to all classes of traders seeking to elevate their trading skills, market awareness, and trading profits.
Another good week for equity markets as earnings season is picking up steam with about 23% of S&P companies having reported Q3 numbers with 84% beating estimates. It’s a strong performance that has turned what was negative sentiment coming into the reporting season into a more bullish tone for sure.
Even as the S&P has recorded a new all-time high, market breadth has not been that impressive and there have been some high-profile blow-ups along the way – namely IBM Corp. (IBM), Intel Corp. (INTC), and Snap Inc. (SNAP) this week. What matters most is forward guidance for the current quarter and any visibility into 2022.
The market is transitioning well from the posture of depending on Fed QE to that of more organic growth that coincides with higher interest rates, rising commodity prices, strong consumer spending, and rotation into more of the reflationary sectors. With that said, traders still seem to be most comfortable trading big cap tech stocks, and that is why this week’s pick falls right into this category.
Stock selection is crucial during earnings season, which can be highly volatile and unpredictable – and this is exactly where the power of our AI models in our Weekly Power Trader advisory service becomes so valuable in identifying those ETFs and stocks with which to trade.
TRADING LANDSCAPE
The $SPY settled at another record high, $453. The value/reflationary stocks traded lower, down 0.2%, and closed near the all-time high. The technology stocks closed in the green, up 0.6%, and settled 2% away from the all-time high.
The $DXY is short-term overbought and retesting key long-term support at $93.5 (break of this support will be bullish for the reflationary stocks). The $TLT continued the bottoming process, retesting recent lows near the 200-day moving average.
The $SPY short-term support level is at $449, followed by $445. The SPY overhead resistance is at $452/$455. Short-term, the market is overbought and due for a shallow pullback in the next few sessions.
I would consider rebalancing the portfolio at this time, raising cash, and having an overall bullish portfolio.
If you are trading options consider selling premium with December and January expiration dates.
"BUY" signal based on the Aggressive Power Trader Portfolio for Monday is at $449 level using SPY and the "SELL" signal is at $453 for short-term traders.
Based on our models, the market (SPY) will trade in the range between $428 and $455 for the next 2-4 weeks.
NEW EARNINGS POWER TRADER SERVICE
We recently launched our new Earnings Power Trader service that we at Yellow Tunnel are very excited about. Each week, our expert traders use our AI Tools to provide the Top Bullish and Bearish Stocks, each with an Entry Price, Target Profit, and Stop Loss.
What makes this new service so special is that it offers real-time alerts via SMS and access to Vlad's live positions and orders. When I put together this system, I wanted to be in the fight with other investors. That’s why I don’t play on your emotions to sell newsletters - I put my money where my mouth is.
Every trade recommendation that I make using this system – comes straight from the list of trade recommendations I use myself.
Not only that but every trade I make is logged in detail for you to review at any time. You can see my entire trading history, updated LIVE so that you can see, learn from, and even copy my trading strategy.
Signals have historically averaged over 86% accuracy in my live trading since inception. Sometimes we hold positions for 2-5 days by using options (selling OTM Calls and Puts spread) and targeting 1% target gain and 1% stop loss using stock price. The green color should be interpreted as a bullish signal and the red color as a bearish signal.
How To Use Our Signals
Once you become a member, I encourage you to review our Live Trading Room recordings to see how I trade Aggressive Power Trader signals in my account. A snapshot of how we produce our Live Trading Room Sessions shows how we pack in a lot of information that can be accessed from whatever device you’re driving.
As a reminder, consider buying near the "BUY" level with a "10 days prediction" higher than the close price. In our live trading room, I usually hold a position for 1-2 days.
I allocate less than 5% of my portfolio if the position is being held overnight. On average, less than 1% of the portfolio should be at risk, if you own a position for less than one day.
I enter a position at the predicted LOW (BUY) price or yesterday's close price. My stop loss is 1% and my target gain is 1% of stock price. I target 75% accuracy using these signals.
Few subscribers asked about Options trading using the signals provided. Please review live trading room recordings. I often sell OTM credit put spread using weekly options and collect 0.5% using stock price. For example, if the stock is trading at $100, I would sell OTM put (strike less than 100) with option BID price close to $0.5.
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Dear Subscriber, 
Instead of telling you what to do (after I trade)…
I will show you what I do (in real-time).
Every trade recommendation that I make using this system – comes straight from the list of trade recommendations I use myself.
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SECTOR SPOTLIGHT
There is a growing feeling that bond yields might not push much higher than where they are over the near term. The benchmark 10-year Treasury closed the week out at 1.65% and though it may grind higher to 2.0%, the market can live with this scenario. More importantly, the mighty tech sector can maintain its bullish bias under this scenario, and being it accounts for 27.6% of total S&P assets, it does pull the market in whatever direction it takes.
Shares of Invesco QQQ Trust (QQQ) are dominated by just a handful of just seven companies that account for 55.70% of total assets. When adding up the three classes of Alphabet, it totals 10.96 thereby holding the #2 spot on the list, just ahead of Microsoft, and should be viewed that way when looking at trading this ETF.
Our AI-driven Forecast Toolbox is providing a bullish short-term outlook for QQQ, with a Model Grade “B” rating and a Predicted Resistance price target of $402 that implies a move higher of 7.4%. When we get such a strong set of signals, it fits our trading profile to a tee. I hope all readers of this blog take full advantage of when we pull the trigger to go long this trade after the market consolidates this most recent rally phase.
TRADE OF THE WEEK
Of the top holdings in QQQ that offer compelling upside, Alphabet Cl A (GOOGL) stands out in particular. The company has phenomenal assets in its Chrome search, YouTube.com, Android, Google Cloud, and Other Bets that include ventures in EV and a host of other unicorns.
The company sports a market cap of $1.9 trillion and is forecast to grow revenues by 37% in 2021 to $250 billion and post a 58% increase in earnings to $101 per share this year. The analyst community is very positive on GOOGL stock, with the average price target being around $3,200 or 15.5% higher than where the stock currently trades.
Source: TipRanks.com
Shares of GOOGL are trading at $2,750 and down from $2,870 earlier in this past week in sympathy with the lower guidance from SNAP.
Aside from the compelling chart pattern, our AI platform is flashing a buy signal on the stock. The Forecast Toolbox gives us a bullish Model Grade “A” rating with a 10-day Predicted Resistance price point of $2,987, implying a move of about 8.5% from its current price of $2,750.
This is what our precision AI platform does for our members. It identifies, clarifies, and verifies high-quality trades like a clear and newfound uptrend in stocks like GOOGL. By being a member of any one of our services, it’s these kinds of opportunities that our proprietary algorithms provide our members to look forward to every day, where they can put their risk capital to work on both long and short positions.
Through our services, we tie our Tradespoon Live Trading Room to manage the parameters of every trade. And we update our closed positions daily. Our AI platform works seamlessly to provide our subscribers with the most robust trading experience available anywhere in the market today.
The beauty of our AI-driven system is that we are always equipped to bring new trades to our members. Trades in best-of-breed stocks and ETFs that are not yet recognized by the larger universe of traders.
We really pride ourselves on this kind of discovery process, to bring trades with very high probability risk/reward parameters to members throughout each week. Our track record speaks for itself from a standpoint of a Winning Trades Percentage, Average Return Per Trade, and Net Gain.
Considering the choppy landscape of late, we’re taking advantage of market dislocation and valuation distortion. We’re striving to help our members ring the register all the time and this is why serious traders don’t trade without market-proven AI tools.
The consistent performance of our services is just incredible. Our historical stellar performance is made possible by being right on 86.36% of all trades that we made with an average profit of 36.93% per trade on our collective trade recommendations. To my knowledge, this trading performance is one-of-a-kind that stands alone in the marketplace for superior trading advice where our numbers and results speak for themselves.
Our Weekly Power Trader members have enjoyed consistent October performance to date and we still have one week to go. We’ve closed out 19 straight profitable trades!
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