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, Microsoft, and Meta Face Key AI Test This Earnings Season

Posted on Jul 01, 2026 by Ian Cooper

As we jump into third quarter earnings, Wall Street will pay close attention to the tech sector where artificial intelligence continues to drive sky-high earnings expectations.

Late July will see quarterly earnings from Alphabet (NASDAQ: GOOGL), Microsoft (NASDAQ: MSFT), and Meta Platforms (NASDAQ: META), with artificial intelligence expected to dominate nearly every investor discussion.

Why This Earnings Season Matters for AI Investors

Over the past two years, companies have committed tens of billions of dollars to expanding data centers, building AI infrastructure, purchasing advanced chips, and developing next-generation artificial intelligence models. Investors are now looking for evidence that those rising capital expenditures are translating into stronger cloud growth, improved advertising performance, and sustainable long-term profits.

For Alphabet, the spotlight will be on Google Cloud and the company’s artificial intelligence strategy. Microsoft faces high expectations for Azure cloud growth and enterprise artificial intelligence adoption, while Meta will be under pressure to show that its AI investments are improving.

All will help show investors just how much momentum is left in the AI trade.

Alphabet: Can Google Cloud Justify AI Spending?

Alphabet is expected to report its quarterly earnings in late July, with investors focusing heavily on the performance of Google Cloud and the company’s expanding artificial intelligence initiatives. Google Cloud has become one of Alphabet’s most important growth engines, steadily gaining market share while improving profitability. Analysts will be looking for continued acceleration in cloud revenue as businesses increase demand for AI-powered services and cloud infrastructure. Strong cloud results would reinforce confidence that Alphabet’s AI strategy is driving meaningful customer adoption.

At the same time, investors are paying close attention to Alphabet’s capex. The company has invested tens of billions of dollars toward expanding data centers, developing custom AI chips, and supporting increasingly complex AI models.

Management’s commentary on artificial intelligence, infrastructure, and demand could prove just as important as the financial results themselves. Any updates on Gemini AI adoption, cloud customer growth, or AI-driven advertising improvementsmay influence investor sentiment.

Microsoft: Azure Growth Takes Center Stage

Microsoft is also expected to release earnings in late July, with Azure cloud growth likely to be the headline metric investors will scrutinize.

Azure has become one of Microsoft’s most valuable businesses, benefiting from enterprise demand for cloud computing and AI services. As organizations increasingly deploy generative artificial intelligence applications, Azure has positioned itself as a preferred platform thanks to Microsoft’s deep partnership with OpenAI and its expanding portfolio of artificial intelligence tools.

In addition, Microsoft continues investing aggressively in data centers, graphics processing units (GPUs), networking equipment, and custom infrastructure needed to support AI workloads. Capital expenditures have risen substantially over the past year, leading investors to question if and when those investments will pay off.

Meta: AI Must Deliver Better Advertising Returns

Artificial intelligence has become a critical component of Meta’s advertising business, helping deliver more personalized content recommendations and improving advertising efficiency across Facebook, Instagram, and other platforms. Continued strength in ad revenue would suggest these AI investments are producing measurable financial benefits.

At the same time, Meta continues spending aggressively on AI infrastructure. The company is investing heavily in advanced chips, massive data centers, and large language models while pursuing its broader vision for AI-powered consumer experiences.

What Investors Should Watch This Earnings Season

With AI continuing to dominate the conversation on Wall Street, these upcoming earnings reports could provide an important reality check for investors. While strong revenue growth remains essential, the bigger question is whether the billions being poured into AI infrastructure are beginning to deliver meaningful returns.

For Alphabet, Microsoft, and Meta, investors will be looking beyond the headline numbers for updates on cloud demand, advertising strength, and how quickly AI investments are turning into profitable growth. If management teams can show that their spending is creating long-term value, confidence in the AI trade is likely to remain strong. But if costs continue to climb without clear signs of payoff, investors may become more cautious.

Your FREE GOOGL,META,MSFT Report...

Get Your Free GOOGL,META,MSFT Stock Earnings Report Now.

Recent Articles

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.

Loading...

Ride-the-Wave Strategy – Best for Stock Traders

Volatility Crush Strategy - Best for Options Traders

Volatility Rush Strategy - Best for Options Traders