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Don’t Let Wall Street Trick You Into Running Away From Winning Trades

by | Oct 22, 2021

Earnings season is driving the markets toward new record highs for the indexes…

Though the Nasdaq is falling Friday after our good friend, Snap Inc. (NYSE: SNAP), reported earnings that were under expectations.

The company claimed it ran into big problems with its advertising business.

The news cut shares of Snap by as much as 25% Friday, dragging other ad-dependent tech stocks like Facebook Inc. (Nasdaq: FB) and Google parent Alphabet Inc. (Nasdaq: GOOGL) down with it.

We’ll have to wait until next week to see if other tech firms have similar problems, but even a perfect report isn’t a guarantee of a move higher.

The trend so far this quarter is for shares to fall flat out of the gate after an earnings event… Only for the stock to conveniently come to life after the trade you placed looks dead in the water.

We’ve seen this with commodity companies like Steel Dynamics (Nasdaq: STLD), but no ticker is immune from this kind of earnings options manipulation…

It happened on Wednesday with Netflix, and again on Thursday with Tesla. Don’t fall for it…

Market Makers and Earnings Options Manipulation

We’ve talked a lot about volatility crush in the past and so far, this earnings season and the options manipulation we’re seeing is exactly why I pound on that lesson.

Just take a look at this move in NFLX …

The stock popped on earnings, only to get sold off after hours.

Then the stock opened Wednesday, where market makers immediately pulled it to smoke out stop-loss orders, popped it and then faded it again. And on Thursday, out of the blue, it’s up $28 a share like nothing ever happened…

This crazy price action happens because the goal of the market makers is to not lose money selling options.

They want to sell options that expire worthless. And nothing chases retail traders off a good position like earnings option manipulation through a volatility crush and stop-loss orders.

They’re big reasons why I emphasize managing risk so we can give these trades the runway they need to take off — and tilt the odds away from the market makers back to us.

Check out the video below and I’ll break down these strange earnings moves we’re seeing this season. Don’t forget you can follow me @LanceIppolito on Twitter, Instagram and our YouTube channel for more trading insights and tips. And as always, you can find me right here talking stocks and options trading — and printing money — on WealthPress.com!

 P.S. What if traders knew — down to the exact day — when a single stock was going to explode by 100%, 150% or even 200%?

Think about that… 

What if someone could count down to a date and sit back and watch as a stock shoots nearly vertical?

Most folks don’t believe that type of timing is possible. 

But thanks to an odd market event I call a “breakout date…”

It’s completely possible… I’ve already seen it happen — and cashed in BIG. 

Here’s How It’s Done {cta}

WRITTEN BY<br>Lance Ippolito

Lance Ippolito

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