Ride-the-Wave Strategy – Best for Stock Traders

Ride-the-Wave targets multi-day price momentum following a company’s earnings announcement (EA). With this strategy:

Buy a stock one day post-EA if a stock reacts positively post-earnings:
1. Near the close of trading the EA-day for a pre-market-EA
2. Near the close of the following day for a post-market-EA
Sell-to-close after 7-10 days, or possibly earlier if a desired price target is reached

Similarly,

short a stock one day post-EA if a stock reacts negatively post-earnings:
1. near the close of trading the EA-day for a premarket-EA
2. near the close of the following day for a post-market-EA
then buy-to-close after 7-10 days, or possibly earlier if a desired price target is reached

Important: Ride-the-Wave is predicated on significant price momentum triggered by an EA. The 7-10 day scenario is the maximum trade hold-time. If you see post EA-momentum is halted or reversed by a significant opposite move, re-evaluate your presence in the trade.

This popular StockEarnings screen below will give you a list of stocks that historically exhibit significant price momentum following an EA for the next seven days:

Stocks exhibiting positive post-EA price moves are buy-candidates
Stocks exhibiting negative post-EA price moves are sell/short-candidates

The screen includes those stocks whose Earnings just came out in last two days.

Screen criteria:

Earnings Date Start Date : Current Date + -1 Day
Earnings Date End Date : Current Date + -2 Days
Predicted Move (Next Day) Max : 7%
Predicted Move (On 7th Day) Min : 7%

Strategy Guideline:

Buy the stock if stock has reacted positively. Short the stock if stock has reacted negatively (see above).
Close the position in 7-10 days, or possibly earlier based on price move.

Volatility Crush Strategy - Best for Options Traders

The Volatility Crush strategy is used with stocks that typically experience relatively low-to-moderate price moves (≤4%) following their Earnings Announcements (EA). The basic trade idea is to sell put or call options right before the EA, collecting a credit when options premium is very high due to elevated implied volatility (IV). You then close the position right after the EA by buying the option back much cheaper due to the significant drop in IV that occurs after the mystery of the EA disappears. In assessing this trade, you need to do your homework to ensure you collect sufficient premium to make the trade worthwhile.

This trade is practical due to the low-to-moderate price-move after the EA, which generally won’t significantly affect the options price, unlike an “action” stock, which experience great price moves post-EA. With these symbols, if you’re on the right side of the price move, that’s a great thing. But if you’re on the wrong side of the move, not so great. Consequently, by minimizing the effect of the post-EA price move, you have a much better chance to profit from the reduction in IV without it being ruined by a violent price move.

For this trade, open the position either (1) the night before the EA when the company announces earnings or (2) during the EA day when it announces post-market, generally capturing IV at or close to its peak.

This popular stockearnings screen will give you a list of stocks which do not react more than 4% fpost-EA. It includes only those stocks whose earnings are releasing next day.

Screen criteria:

Earnings Date Start Date : Current Date + 1
Earnings Date End Date : Current Date + 1
Predicted Move (Next Day) Max : 4%
Options Type: Weekly

Strategy Guideline:

Options Strategy: Sell Call and Put
Options Strike Price: Current Stock Price – (% Predicated Move x 2)
Expiration Date: It should generally be the closest expiry immediately after the EA.
Buy Insurance: Buying back Call and Put at Strike price which 10% lower than Sell Strike Price is optional but recommended.

Watch Video for More Detail

Volatility Rush Strategy - Best for Options Traders

The Volatility Rush takes advantage of increasing options premiums into earnings announcements (EA) caused by an anticipated rise in Implied Volatility (IV). With this strategy, Buy a Call and Put at-the-money (a long straddle) 2-3 weeks before the EA when IV is lower. Sell the position either (1) the night before the EA when the company announces earnings pre-market, or (2) during the EA day when it announces post-market, generally capturing IV at or close to its peak.

This popular screen will give you a list of stocks whose Options premiums tend to rise into Earnings. It includes only those stocks whose Earnings are at least two weeks away from today.

Screen criteria:

Earnings Date Start Date : Current Date + 15 Days
Earnings Date End Date : Current Date + 30 Days
Predicted Move (Next Day) Min : 5%
Options Type: Weekly or Monthly if that lines up with the two to three-week lead-time for entering the trade

Strategy Guideline:

Buy a Straddle at or close to the money two to three weeks pre-EA.
Sell the position either the night before the EA when the company announces earnings pre-market, or during the EA day when it announces post-market.
Expiration date should generally be the closest expiry immediately after the EA.
Straddle price should not be more 60% of predicted move.

Predicted Move (Volatility)

Similar to Implied Volatility in Options. Expected volatility % based on our Proprietary Volatility Predication Model. We are expecting that stock price will likely to reach % in either direction by the end of next trading session after Earnings are released and not necessarily the closing volatility %.

Why is it important?

This indicator helps

Knowing expected volatility in stocks after Earnings helps to decide trading stocks before Earnings Announcement.
Taking Advantage of volatility collapse following Earnings Results by using Advance Options strategies such as Spread and Straddles.

Since Last Earnings

Change in share price since last Earnings release.

Why is it Important?

When share has gained more than 10% since it's last Earning release, it tends to over react to minor bad news and give up some gains if not all. So, it contains more downside volatility than upside When share has dropped more than 10% since it's last Earning release, it tends to over react to minor good news and recover some drops if not all. So, it contains more upside volatility than downside.

EPS Surprise (%)

Occurs when a company's reported quarterly or annual profits are above or below analysts' expectations. Here is the formula to derive % EPS Surprice:

Actual EPS - Estimated EPS
------------------------------------- x 100
Estimated EPS

Why is it Important?

Earnings surprises can have a huge impact on a company's stock price. Several studies suggest that positive earnings surprises not only lead to an immediate hike in a stock's price, but also to a gradual increase over time. Hence, it's not surprising that some companies are known for routinely beating earning projections. A negative earnings surprise will usually result in a decline in share price.

Next Day Price Change (%)

Next Regular trading session Closing price following Earnings result.

For After Market Close Earnings, It is a next trading day closing price. For Before Market Open Earnings, It is the same trading day closing price.

Why is it Important?

Next Day price change is a reaction of Earnings result.

Alphabet Faces a $205 Billion Test as Earnings Approach

Posted on Oct 16, 2026 by Ian Cooper

Alphabet (NASDAQ: GOOGL), the parent company of Google, YouTube, and Google Cloud, has scheduled its third-quarter earnings call for October 28 at 4:30 p.m. Eastern. For investors in Alphabet, the report offers another chance to see how its advertising business and expanding AI operations are working together.

There is plenty to watch. Cloud growth has accelerated, but building the infrastructure behind that growth is expensive. Meanwhile, Google still needs to show that its search business can keep attracting users and advertisers as AI changes how people find information.

Estimates call for earnings of $3.02 per share on revenue of $127.67 billion. That compares with earnings of $2.87 per share and revenue of $102.35 billion a year earlier, implying roughly 5% earnings growth and 25% revenue growth.

Google Cloud Has a Lot to Prove

Google Cloud could be the biggest focus of the report. In the second quarter, Cloud revenue climbed 82% to about $24.8 billion. Alphabet also began recognizing revenue from sales of its tensor processing unit systems, or TPUs, which are specialized chips used for AI workloads.

That momentum has some analysts raising their expectations. JPMorgan analyst Doug Anmuth now expects third-quarter Cloud revenue to double from a year earlier, according to Barron’s. He also raised his Alphabet price target to $425 from $420, citing greater contributions from TPU sales.

For investors, the distinction matters. Strong growth can become harder to impress with when expectations are rising just as quickly. The quality of that growth deserves attention, too. Investors should look for management to explain how much comes from ongoing cloud usage, how much comes from hardware sales, and what that mix means for profitability.

Search Still Pays Much of the Bills

Cloud may attract the excitement, but Google Search remains central to Alphabet’s financial health. Second-quarter revenue from Google Search and related activities reached about $63.3 billion, up from $54.2 billion a year earlier. YouTube advertising revenue also increased, reaching about $11.1 billion.

The next report should help investors assess whether that advertising momentum is holding up.

The key question is how effectively Google can turn changing search habits into revenue. AI-generated answers may make the service more useful, but usefulness alone does not tell investors how much advertisers will pay or how profitable those interactions will become.

I would watch for management’s comments on search activity, advertiser demand, and the economics of AI-powered features.

YouTube also deserves attention. Its results can help show whether advertising strength extends beyond Search. Broad growth across both businesses would provide more reassurance than a strong result concentrated in just one area.

The Spending Bill Could Shape the Reaction

Alphabet previously raised its 2026 capital spending outlook to $195 billion to $205 billion. Management also said spending would increase significantly in 2027. Second-quarter free cash flow was negative as infrastructure investment absorbed more than the cash generated by operations.

That creates a practical challenge: Alphabet needs capacity to meet demand, but shareholders also want evidence that the investment will produce attractive returns.

Watch for changes to the spending outlook, progress in cash generation, and commentary on future costs. A revenue beat could lose some shine if it comes with another spending increase and little explanation of the payoff.

Ultimately, this earnings report needs to connect growth with financial discipline. Strong Cloud demand, healthy advertising, and a convincing explanation of infrastructure spending would strengthen Alphabet’s case. Investors do not need every AI investment to pay off immediately. But they do need to see that the company is moving toward durable profits and stronger cash flow. On October 28, that progress may matter more than the headline earnings number.

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Over the last 26 years, he’s taught thousands of investors how to trade news flow and herd mentality using a unique blend of technical and fundamental analysis. Cooper was among the few analysts to spot the financial crisis of 2008, the top of subprime and Alt-A, the death of Lehman Brothers, Bear Stearns, and New Century Financial, and even the Dow’s collapse to 6,500, as well as its recovery. He even called for gold to rally well above $1.500 when it traded under $600. At the moment, Cooper makes use of technical, fundamental and news analysis, to help individual investors grow their wealth. He’s a firm believer that hard work and thorough research will lead to investment success.

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Ride-the-Wave Strategy – Best for Stock Traders

Volatility Crush Strategy - Best for Options Traders

Volatility Rush Strategy - Best for Options Traders