Post earnings trade setups: Zoom, Taylor Wimpey, Abercrombie & Fitch

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.

Zoom Video Communications

Zoom shares enjoyed a year to remember in 2020, with the stock gaining over 400% over the course of the year. However, fears are growing for this lockdown favourite, with the stock tumbling alongside other tech names despite a surge on the release of their blockbuster fourth-quarter figures. That takes us back towards the key $31750 support level. A break below there would bring about a wider bearish view for this stock. However, until that happens there is still a good chance we see the bulls step in once again from here.

Taylor Wimpey

Housing stocks received a boost from the chancellor’s latest budget, with Taylor Wimpey no exception to that. Gains over the course of Thursday in particular too price up through the £1.76 resistance level for the first time in almost a year. With price having pulled sharply back in the hours that followed that break, we are looking for an ability to sustain price action above horizontal and trendline resistance. As such, the key here is whether we can finally break from this consolidation phase, with a failure to take out this peak signaling the potential continuation of that multi-month sideways trajectory.

Abercrombie & Fitch

Abercrombie & Fitch shares have been on a remarkably consistent run over the course of the past year, with the initial Covid pullback giving way to an impressive uptrend. This has taken us up into the 2019 peak of $29.10. A break through that historical resistance level would bring greater confidence of a bullish continuation. On the flipside, a decline through trendline and $26.16 support would bring an end to the ongoing uptrend and bring a more concerning outlook for the stock.