Post-earnings trade setups: Salesforce and Gap
With Q2 earnings season slowing down, Salesforce and Gap provide us with potential trading opportunities.
This article looks at some of the big movers off the back of recent earnings announcements to try and find stocks that seem to provide a good trading opportunity.
Typically, earnings announcements and trading statements will drive a shift or enhancement of market sentiment.
While many see earnings as a significant risk when holding a stock, placing trades in the wake of such events allows for greater confidence that all market knowledge has been factored into current prices.
Tech giant, Salesforce enjoyed a strong second quarter (Q2) with the company providing a major EPS beat ($1.48 per share versus 92 cents expected).
Meanwhile, revenues grew 23% compared with Q2 2020. This looks to provide the basis for a continuation of the breakout seen last week.
The push through trendline and $251.19 resistance brings expectations of further upside, with a bullish view in play unless price breaks below $234.35.
Gap posted Q2 revenues and earnings that beat market estimates, although the success of the stock meant the share price saw little upside in response.
The weekly chart highlights the wider uptrend in play since the pandemic lows. While we are seeing further downside come into play this week, there is a strong chance we are looking at a retracement before we head higher once more.
With price currently respecting the 61.8% Fibonacci support level, bullish positions are favoured until price breaks below the 2021 lows of $19.09.
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