EC 6 Monster Earnings Predictions For The Week Of January 28

It will be a massive week for the markets, with trade negotiations, significant earnings reports, and of course the Fed meeting –with a presser. That means up to two hours of Jay Powell up there on stage taking questions, talking off the cuff, and saying whatever comes to mind. Hopefully, he will use a sheet with some notes again on things to say and not mention, like when he was with Bernanke and Yellen a couple of weeks ago.

Things to say:

Sounds easy enough, let’s hope he sticks, to the script, and we don’t have a repeat of the last meeting in December.

Earnings

Then, of course, we have HUGE earnings this week from Apple, AMD, Facebook, Microsoft, Tesla, and Amazon. Here are some prediction –so keep score at home.

Apple (AAPL)

For Apple, it will be about any color on how the iPhone is doing and of course quarterly guidance. The options market isn’t pricing in a big move for Apple after the result. The long straddle for expiration on February 15 suggests that the stock rises or falls about 6.5% from the $157.50 strike price. It places the stock in a trading range between $147.50 and $167.50. It would at least suggest to me that much of the bad news has been priced already.

The put to call ratio at the $160 strike is overwhelming bullish with 27,000 open calls to just 11,500 puts. Open interest at the $160 strike price has been steadily building over the past few weeks.

apple

The chart signals that perhaps investors are betting that guidance next quarter isn’t as bad. We can see that stock has lifted meaningfully off the lows. Additionally, the relative strength index has started to trend nicely higher. I think the stock may even be trading north of $165 following results.

apple, aapl, stock, earnings

AMD

AMD, however, is expected to see a huge price swing following results. The long straddle shows that options are pricing in a rise or fall of nearly 16% by expiration on February 15 from the $22 strike price. That places the stock in a massive trading range of $18.55 to $25.45 by expiration.

1 2 3
View single page >> |

Disclosure: Michael Kramer and the clients of Mott Capital own Microsoft, Apple, and Tesla

Disclaimer: This article is my opinion and expresses my views. Those views can change at a ...

more
How did you like this article? Let us know so we can better customize your reading experience. Users' ratings are only visible to themselves.

Comments

Leave a comment to automatically be entered into our contest to win a free Echo Show.