Trading GameStop for a Pre-Earnings Short

Hey traders!

GameStop has 25% short float, and Roaring Kitty has thrown massive fuel on the fire right before earnings.

With GME trading higher on high volume, and breaking through levels of previous highs, that sets it up for a potential short squeeze pre-earnings.

GME will typically trade higher before earnings, as buyers speculate and short sellers buy to cover. But, be warned because it also has fallen 3/4 quarters post-earnings in a ‘buy the rumor, sell the news,’ fashion.

Out of the money calls or at the money butterflies are two methods of trading this move. I discuss this and more with Kelly Evans on CNBC The Exchange. Check it out in the video below!

 

 

P.S. Check out our Memorial Day sale using this link!

Up Next...

Welcome to September

September is here, and its entrance is dashing hopes that September seasonality came early. As of this writing, the Nasdaq futures are down 2.25%, and the S&P is down 1.37%. What’s interesting about the summer pullback is that semiconductor and technology stocks led it lower. This is critical to mention because these are typically the … Read more

Read More

Trading Earnings Induced Short Squeezes Using Butterflies

Trade Review I love using butterflies for low-cost earnings trades! This low-risk trade cost me $155, and I traded this ticker directly to my target overnight, making a triple on my debit. This earnings trade in CHWY had the following: Pre-earnings short squeeze candidate A ticker with an earnings turn around story Extremely low risk … Read more

Read More

Trading Earnings Induced Short Squeezes

Earnings reports can provide trading opportunities, particularly when stocks with high short interest, such as Gap (GAP) and Peloton (PTON). I joined Dominic Chu to discuss my short squeeze trade in PTON, a potential reversal in Paypal (PYPL), a pre + post-earnings trade in GAP, and my pessimistic take on NKE.

Read More

Subscribe Today!

Want my up-to-date analysis, setups, top trading tips, and more? Be a Five Star trader, and join my free newsletter today!

Sign Up Now
all-as-seen-on-logos