| November 4, 2014 | Archives | Unsubscribe | | | | | |
 | | | | Play the Health Care "Earnings Catalyst" for Double-Digit Gains | | | - How earnings could send one sector on a two-month tear...
- Winning the numbers game
- Plus: Gauging gold's bear market rallies
|
| | | Greg Guenthner coming to you from Baltimore, MD...
 | | Greg Guenthner | The financial media is still busy yapping about October's market swoon...the oil crash...and the gold meltdown.
So you might have forgotten that we're about to wrap up earnings season.
Why do we give a rat's behind about earnings?
Because a quarterly earnings report can make or break a stock-- and your trades. Great numbers can vault a company's stock to new highs, while disappointing earnings can send it reeling. At least in the short-term...
That's why you have to know exactly where to put your money as companies are tossing their numbers around this month.
Already this season, companies beating earnings expectations have seen their stocks spike almost 3% after two days. On the other hand, those coming up short have dropped 0.6% over the same period.
And as a trader, you don't want to be holding a stock about to cough up a bad earnings report. One bad earnings report can blow up your entire trade. But a good one can make you look like a genius.
Today, we're going to play a powerful "earnings catalyst" that should push one select group of stocks to new heights as the year winds down. Act on it today and your buddies might be calling you Einstein by New Year's Day.
I'll explain what it is-- and how you can play this earnings catalyst for double-digit gains by trading a simple ETF-- in just a moment...
But first, you should know that earnings have been kicking serious butt this season. FactSet reports that so far, 78% of companies have beaten Wall Street earnings consensus this quarter. That's the highest earnings beat rate since early 2010.
And according to Bespoke Investment Group, the average stock reporting this season has gained 1% on the day of its report.
Bottom line: it's been a darn good season for earnings. And you have a great opportunity to book some gains on this trend heading into the holiday season...
If you're looking to play the earnings game, you can't just throw darts at the overall market and expect to win. No sir, you need to put your money on the sector that's beating expectations.
And what sectors are showing the best earnings today? Hint: They're not Energy and Basic Materials. The chart says it all. Avoid these doggies. Your longer-term trading dollars be heading into the end of the year should be in health care.
That's right, health care. Take another look at the chart. Healthcare companies are beating the stuffing out of earnings estimates from any other major sector. And as FactSet reminds us, investors are more prone to rewarding those beats than punishing misses. In other words, a stock coming in one thin dime ahead of expectations can shoot up dramatically. And we should be seeing a lot of that in the healthcare sector this season.
Health care has been a beast of a trade all year long. The sector is up more than 22% year-to-date, while the S&P 500 has gained only 9%. And the best part? I don't see a change in this trend on the horizon. So we're sticking with the strong earnings hand heading into the holiday season. And that's health care. | | | | | | | | |
We've just been informed that a major U.S. government agency plans to "disrupt" sections of the stock market on the following dates…
- Wednesday, Nov. 5, 2014
- Friday, Dec. 5, 2014
- Tuesday, Dec. 23, 2014
- Tuesday, Dec. 30, 2014.
If you've got any money in the markets right now (or are thinking of getting in)… Put these critical dates on your calendar now. Click here. | | | | | | | |  | | | | Rude Numbers | Targets, Predictions and Wild Guesses
| | | | 448 | points were added to the Nikkei today. The Japanese index has endured some wild swings over the past week as it rose to 7-year highs... | | $4.06 | is the price of natural gas this morning. Natty is breaking out while oil continues to slump. Speaking of which... | | $77 | buys a barrel of crude today. After finding buyers at $80 over the past two weeks, oil finally cracked, slumping more than 2% this morning... | | $16.01 | is where you'll find silver futures this morning. The poor man's precious metal continues to get hammered. It's down another 1.2% in early trading... | | 2,006 | marks the spot for S&P futures just before the bell. Stocks are set to open slightly lower to begin the trading day... | | | | | | | | Rude Trends | When to Buy... When to Sell
| | | Time to talk gold this morning...
"I checked the archives," writes a curious reader. "Your commentary said 'flip your dollars and buy gold'. Care to clarify?"
Sure.
Back in May, I spotted a major breakout in the U.S. Dollar. Greenbacks were poised to make a serious run (which is bad for gold, of course). Once the dollar started on its rise, it looked like nothing would stop it. And after just a few months, the Dollar Index had rallied 8%.
It was a great trade. But in my view, the greenback had moved too far, too fast. And gold looked as if it were ready to embark on a relief rally before its next leg lower. So I flipped the trade in early October. This time, we were looking for short-term gains. I alerted Pro readers to the Market Vectors Gold Miners ETF (NYSE:GDX) - one of my favorite ways to trade gold's wild swings over the past couple of years. At the time, GDX was painfully oversold and had snapped back considerably after shares found a bottom.
But the move didn't hold. We sold GDX a couple of weeks later for a loss of about 5%. Shortly after the sell, the Midas metal started to break down again.
The bottom line is this: Gold is in a bear market. But it has showed us some impressive counter-trend rallies that we've attempted to trade over the past 18 months. Some have worked out well. Others-- like the trade I mentioned above--did not.
I'll be the first to admit that I'm not always right. But that's OK. As long as we stick to our trading rules, we'll win more often than we lose. That's why we're always ready to pounce when the market gives us a signal...
[Ed. Note: Send your feedback here: rude@agorafinancial.com - and follow me on Twitter: @GregGuenthner] | | | | | | | Ignore At Your Own Peril | Today's Must Read Links
| | | | | | | | | BE SURE TO ADD rude@agorafinancial.com to your address book.
| | | | | | | Additional Articles & Commentary:
Join the conversation! Follow us on social media:
| | | | | | | | | |
© 2014 Agora Financial, LLC. 808 Saint Paul Street, Baltimore MD 21202. Although our employees may answer your general customer service questions, they are not licensed under securities laws to address your particular investment situation. No communication by our employees to you should be deemed as personalized investment advice. 
No comments:
Post a Comment
Keep a civil tongue.