Thread by @traderDanielle

This week's list of #Earnings destruction candidates is the longest it's been all quarter.

Earnings destruction means they are highly likely to tank even more on earnings.

These are 2022's Dotcom stocks.

#StockMarket
@cvpayne @traderTVLIVE @KellyCNBC @simplertrading

Earnings destruction can be traded:
1. Pre-earnings for a short going into the report (but not through) = conservative
2. Over the earnings report itself (aggressive)
3. Post-earnings (most conservative)

Personally, I trade them in the options market.

It's also a heads up in case you're holding any of these stocks in your long-term portfolio. The move in $PLTR today, yikes!

When tickers are already trading lower into earnings, especially if they are still losing money, sometimes all it takes is another bad report to roll hard

Remember, in the options market, buying puts before earnings ONLY WORKS if the ticker moves around twice the expected market maker move.

Buying options in the same series as earnings is usually a bad plan, due to the IV crush. I have been buying options further out bc of this.

Selling premium in the options market (due to high IV going into earnings) is the most conservative way to trade an earnings report. This is because even if the ticker doesn't tank, you can still make money purely based on IV crush. This is because options cost less post-earnings

Trading earnings is always going to be risky. If that is not your jam, the pre and post-earnings trades are going to be more conservative. This is because, at that juncture, you know which direction the stock is going, and you can jump on the trend.

One thing that can be a PITA about these is that IF a miracle occurs, they can rally, hard, on earnings. This is not fun when short over the report. To avoid this, waiting until after earnings, and shorting on a rally, would equal a much better entry.

Tickers that have ? by them are ones that I hesitated to include because they can actually have nice, bullish moves post-earnings. However, I included them because they fit all other parameters. For those, I probably won't trade the actual reports.

Due to this many destruction tickers reporting this week, I highly doubt earnings will be a bullish catalyst in this market.

That being said, the indexes are on yearly lows and the put/call is very high. We could short squeeze at any moment, but there would have to be a reason.