Upcoming Earnings Calendar (Feb 28th - Mar 4th)
Hey guys! Here's the upcoming earnings calendar! Two of my holdings, $SE and $SOFI report next week, so I'll be paying significant attention to both. Other than that, I'm also interested in seeing what retailers like $TGT $BBY and $COST have to say about supply chain issues and inflation.

Good luck to everyone!

If you'd like an easier way to track earnings dates, you can automatically sync your portfolio's earning dates to your personal calendar with just a couple of clicks here.

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TUE:


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FRI:
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Upcoming Earnings Calendar (Nov. 29 - Dec. 3)
Happy Thanksgiving everyone!

This week was light on earnings reports, but next week is shaping up to be very interesting in the stock market. None of my holdings report, but I'm still interested in listening to the $CRM, $CRWD, $SNOW and $DOCU earnings calls.

I'm also hoping we get post-earnings commentary on $CRM from @gkotak, $DOCU from @invesquotes and $OKTA from @tolvkin so that I can learn more about these companies.

Remember, if you'd like an easier way to track earnings dates, you can automatically sync your portfolio's earning dates to your personal calendar with just a couple of clicks here.

Monday:

Tuesday:

Wednesday:

Thursday:

Friday:
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Sharing my top positions here.
A few points / caveats:

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$SU - Episode 1: Why 'cup and handle' formations happen
Get yourself a coffee and make yourself comfortable before settling down for this one. I got very emotional and things got way out of hand.
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Suncor Energy posted killer earnings yesterday and doubled their quarterly dividend, closing 13.19% up today as a result. Even without these two pieces of fundamental information, $SU has a number of bullish chart patterns that I annoyingly missed because I'd never even heard of Suncor; rest assured they are now on my Energy watchlist.

But the silver lining here is that the density and nature of the signals will fuel my memo writing for a couple of days :) And before I get into the meat of the subject, it wouldn't be a 'Michael Memo' if I didn't waffle first.

Waffle
Technical Analysis is often perceived to be the mind-numbing memorisation of seemingly arbitrary price patterns. And, to be fair, that's exactly how I started to learn it and how I imagine most others have. But staying at this surface level of knowledge has HUGE pitfalls and puts traders that do so at a great disadvantage. The concepts and practice of technical analysis were there before the patterns had names, and so it stands to reason that if you understand how the patterns form then ultimately you won't need them any more (I'm nowhere near that level btw). You'll also begin to realise that many of the patterns are exactly the same phenomena but with a different name (most likely so somebody could sell a book on the matter).

The Meat

In the image above we can see an 'Inverted Head and Shoulders' pattern (purple) and two 'Flags' (black), and I'll cover those in Episodes 2 and 3. Interestingly, in this instance, they are also part of a larger 'Cup and Handle' (CAH) pattern.

The CAH is a bullish continuation pattern - you would expect to see it during a pause of an extended rally and for the price to continue up afterward.

In textbook examples like the one above, the price reaches a 'relative high' before curving down and back up to a resistance point which, in this case, is the previous high - here is our cup.
The price then abruptly drops down, though no lower than the bottom of the cup, before continuing the original uptrend - here is our handle.

Looking again at $SU, we can see how the chart looks to have to completed its CAH and is on its way back up.

Some of you might have already noticed how the handle is, quite simply, a Flag. That isn't a happy coincidence that just so happened on $SU but that is exactly what the handle is (remember earlier when I said TA is all the same stuff with different names?).

Now that we've established the handle is just another name for a Flag, what is the cup if not a 'curved bottom'?

Jesus Christ, if you google 'curved bottom chart pattern' this is the first image you get and it's a fucking Cup and Handle!!! Look at the flag on the right-hand side of the cup!!! IT'S ALL THE SAME STUFF!

Now, this may seem as though I'm over-simplifying things but I'm really not - what is a 'curved bottom' if not just a smoothed triangle?

It's now much easier to interpret a CAH as its constituent parts. Part 1 shows a simple retracement from a new high in an up move. Part 2 shows that the bears have lost interest and the price is low enough again for the bulls to resume buying. Parts 3 and 4 are just a smaller version of 1 and 2; a retracement from a high before returning back up the resistance (and hopefully breaking it).

Examples

I've managed to find some good examples to illustrate my point.

Below is $ASML's daily chart. We've got CAH on the brain so you can probably make out the pattern below quite easily, but still try to consider it as separate parts.

  • We reach a high in a rally
  • There's a retracement
  • The price goes back to a resistance (in this case it was a large downward gap)
  • Falls a second time, but smaller than the first.
  • Rallies again and passes the resistance

$COIN did the same thing from the start of September to mid-October

  • We reach a high in a rally
  • There's a retracement
  • The price goes back up to a resistance (in this case the resistance turned out to be the brief sideways movement before continuing the retracement)
  • Falls a second time, but smaller than the first
  • Rallies again and passes the resistance

$ALLK is a bit more of a complex example but it follows the exact same principles. It's very 'not textbook' though I bet we can do it even without any crayons.

  • We reach a high in a rally
  • There's a retracement
  • The price goes back up to a resistance (in this case, the previous high)
  • Falls a second time, but smaller than the first
  • Rallies again and passes the resistance BUT
  • Falls a third time, but smaller than the second
  • TBD

$BOX is even more abstract but you will still see the exact same thing.

In fact, you might see two CAH patterns side-by-side, the first being a 'failed signal'.

However, I still haven't explained the underlying reason why this happens. It's a combination of order absorption and...things I don't know yet (such as Elliot Wave Theory) though I will make sure to waffle when I do. But what I do know is that once you start scratching the surface you can see the 'patterns' in a lot more places.

Join me next time for "**$SU - Episode 2: The Head and Shoulders is just a Cup with Two Handles"** (yes, it really is that simple)
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The psychology behind 'why' this pattern forms is interesting:

To use your bullets:
  • We reach a high in a rally (why? Who knows. Just go with it)
  • There's a retracement (why: profit taking. The selloff is usually not so steep because it is coming mostly the sale of profits, as opposed to selling the whole position. The price gradually declines and consolidates over time instead of plummeting.
  • The price goes back up to a resistance (why: previous buyers, as well as new ones, see the pullback as an opportunity to accumulate positions, leading to a gradual ascent to retest the high from where the pullback initially started)
  • Falls a second time, but smaller than the first (why: not sure? Thoughts?
  • Rallies again and passes the resistance (why: not sure. Thoughts?)
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$BOX - priming itself for a bullish breakout.
Thanks go to @gkotak for bringing this one to my attention and @nathanworden for organising the initial conversation (and all of his other ongoing work, of course).

$BOX breaks one of my core trading rules in that is has less than 10% upside from current price to average analyst rating.

It's closer to 9.8%, but there's where the bad news seems to end.

On the chart, we can see an uptrend since the March 2020 sell-off and a consolidation into a trading range.

And there is a lot of interesting activity inside the range. One of the things we can see is that the support touches are taking longer to happen while the resistance touches are happening more quickly; the price is starting to rise faster than it is falling.

We can also see that the price is often finding it a struggle to return to the support of the range as highlighted by the yellow boxes below.

From the above two phenomena, we can deduce that buyers are willing buy sooner and at higher prices while sellers appear to be holding out for longer. What I would expect from this is for the sell orders around the resistance level will eventually be exhausted. If you're familiar with the concept of order absorption, this is a good example.

Focusing in on the last few weeks of activity, we can see the price begin to consolidate into a descending triangle against the resistance following a rally.

Normally, I trade in the direction of a triangle's hypotenuse. But when you consider the triangle in the context of the wider chart picture then I would be comfortable to consider it a bullish continuation pattern.

Finally, if we focus on Friday's action using the 5 minute chart, we can see an impressive rally accompanied by even more impressive volume.

What makes me even more impressed with the above rally and volume is the timing; Friday afternoon up until close. Many day-traders and swing traders close out their positions before the end of Friday so that they're not subject to any news or negative events over the weekend or pre-market Monday, so to see this is a great sign.

I'm looking forward to opening up a position on $BOX Monday pre-market.

SL = $25.28 (slightly below triangle pattern and ~4% from current price)
TP = $29
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Eric Pelnik's avatar
$273.5m follower assets
Earnings this week
📞Which calls are you most excited about?

Monday, May 24th
$API Agora
$PLUG Plug Power

Tuesday, May 25th
$AZO AutoZone
$CBRL Cracker Barrel
$URBN Urban Outfitters
$INTU Intuit
$JWN Nordstrom
$ZS Zscaler

Wednesday, May 26th
$ANF Abercrombie & Fitch
$AEO American Eagle
$NVDA Nvidia
$DKS Dick's Sporting Goods
$ZUO Zuora
$SNOW Snowflake
$PSTG Pure Storage
$PDD Pinduoduo
$WSM Williams-Sonoma
$WDAY Workday
$OKTA Okta

Thursday, May 27th
$PLAN Anaplan
$ADSK Autodesk
$ULTA Ulta Beauty
$BBY Best Buy Co
$BOX Box
$DG Dollar General
$COST Costco Wholesale
$DOMO Domo
$DLTR Dollar Tree
$GPS Gap
$HPQ HP
$YEXT Yext
$CRM Salesforce
$VMW VMWare

Friday, May 28th
$BIG Big Lots

Sources: Business Insider, Google Finance, Yahoo Finance
$CRWD Looking for an overdue bullish move

$COST Hoping for a pullback to re-enter at a better cost basis

Bystander interest in several others 😊
View 4 more comments
Eric Pelnik's avatar
$273.5m follower assets
Earnings this week
Which calls are you most interested in listening to?

Monday, March 1st
$APPF AppFolio
$ZM Zoom Video
$WKHS Workhorse Group
$LMND Lemonade
$MELI MercadoLibre

Tuesday, March 2nd
$BOX Box Inc
$HPE Hewlett Packard
$TGT Target Corp
$FUBO Fubotv
$URBN Urban Outfitters
$JWN Nordstrom
$VEEV Veeva Systems
$SE Sea
$AZO Autozone

Wednesday, March 3rd
$RRGB Red Robin Gourmet Burgers
$WEN Wendys
$DLTR Dollar Tree
$VRM Vroom
$SNOW Snowflake
$SPLK Splunk
$YEXT Yext
$OKTA Okta

Thursday, March 4th
$KR Kroger
$COST Costco
$GPS Gap
$MDLA Medallia
$SDC SmileDirectClub

Friday, March 5th
$BIG Big Lots

Sources: Business Insider, Google Finance, and Yahoo Finance
MONDAY : ZM MELI LMND
TUES : HPE TGT VEEV SE AZO URBN
WED : WEN DLTR SPLK OKTA SNOW
THURS : KR COST GPS SDC
FRI : BIG
View 1 more comment
Eric Pelnik's avatar
$273.5m follower assets
Earnings this week
Monday, Nov 30th
$ZM Zoom Video

Tuesday, Dec 1st
$CRM Salesforce
$BOX Box
$NTAP NetApp
$HPE Hewlett Packard

Wednesday, Dec 2nd
$CRWD Crowdstrike
$SPLK Splunk
$ZS Zscaler
$OKTA Okta
$SNOW Snowflake
$ESTC Elastic
$FIVE Five Below

Thursday, Dec 3rd
$KR Kroger
$DLTH Duluth
$DOCU DocuSign
$CLDR Cloudera
$ULTA Ulta
$ZUO Zuora
$DOMO Domo
$PD Pagerduty
$DG Dollar General
$MDLA Medallia

Friday, Dec 4th
None of interest

Sources: Business Insider, Google Finance, and Yahoo Finance
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