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.

Target Shows Signs Its Turnaround Is Working

Posted on Aug 19, 2026 by Ian Cooper

Target (NYSE: TGT) is showing signs that its turnaround plan is starting to work. The retailer reported stronger-than-expected sales for its second quarter and raised its outlook for the rest of the year.

The company also benefited from more than $700 million in tariff refunds. For the quarter ended August 1, TGT reported $26.54 billion in sales, up 5.3% from the same period last year. Wall Street had expected about $26.14 billion. Comparable sales jumped 3.8%. That was well above analysts’ expectations of 2.4%.

The company said sales were strong across most parts of the business. Food and beauty were among the strongest categories, while apparel and home continued to struggle. “We’re encouraged by the progress made so far,” CEO Michael Fiddelke said, as quoted by CNBC. However, he also warned that the company still has plenty of work to do.

Tariff refunds boost profits

TGT’s profits saw a massive boost from tariff refunds during the quarter. The company reported $1.88 billion in net income, or $4.11 per share. That compares with $935 million, or $2.05 per share, a year earlier.

However, those numbers include the benefit from the tariff refunds. Target said the refunds added $752 million to net earnings, or $1.65 per share. The refunds also provided a $994 million pretax benefit to gross margin and operating income.

Thanks to refunds, Target raised its earnings forecast for the full year. But the company said it is also seeing stronger sales, which helped support the higher outlook.

TGT now expects full-year sales to grow by about 5%, up from its previous forecast. The company expects full-year earnings per share of between $9.90 and $10.90, including the tariff refunds. Without the refunds, Target expects earnings per share of $8.25 to $9.25. That is still higher than its previous forecast of $7.50 to $8.50.

Digital sales are growing

Target’s online business also had a strong quarter. Digital comparable sales increased 8.7%. Same-day delivery grew by more than 25%.

The company has been investing in ways to make shopping more convenient for customers. Those efforts appear to be paying off as more people use the company’s digital services.

Target also said all six of its major merchandise categories grew during the quarter.

However, not every part of the business is doing so hot. Home and apparel remain challenges

Target continues to have problems in its home and apparel businesses. “We knew a category like home was going to be a multiyear journey,” Fiddelke added. Target plans to make more changes in both home and apparel as it works to improve those parts of the business.

Lower prices and new stores

Target is also trying to attract shoppers by lowering prices. The company said it has reduced prices on more than 10,000 products, with more price cuts planned.

That strategy is important because many consumers are still being careful about their spending. Higher costs and economic uncertainty have made shoppers more focused on getting good value for their money. Target also opened 17 new stores during the quarter. The company hopes that lower prices, better products, new stores and improved digital services will help bring customers back.

Investors appear to be responding positively to Target’s progress.

And for now, the company appears to be heading in the right direction. Sales are improving, digital business is growing and the company is making changes to weaker parts of its business. The tariff refunds gave profits a temporary boost, but the bigger test will be whether Target can continue growing after that one-time benefit fades.

For a retailer that has struggled to maintain consistent growth, the latest results offer a reason for optimism, but the turnaround is far from finished.

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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