By: Tom Gentile
on April 22nd, 2022
We are in earnings season so what one has to manage is their expectations on Money Calendar patterns keeping the earnings date in mind.
We are not advocates of holding an options trade over an earnings announcement, even a straddle has rules as my Operation Surge Strike colleague and friend Mike Wade teaches in his advanced training.
With Money Calendar, if the end date is past the earnings date, be aware of that and be prepared to close the trade win. lose or draw prior to the earnings date (even though the Money Calendar pattern shows it need more time past the eps date).
Otherwise try and find a Money Calendar candidate whose end date is prior to an earnings announcement date so the risk of holding over earnings is not a concern.
Another approach is to look at Money Calendar setups where the earnings have already reported.
What is Money Calendar
This is one of my may different “scans” available in my online options analysis software www.tomstoptiontools.com
It is a scan that analyzes the past 10 years (can actually do the past 20-years) of price data to find periods of times over the years where the stock made a higher or lower price move over pretty much the same period of days in each of those years.
It will calculate if the stock or ETF did this 9 or 10 of the past 10 years (that is where we get the assessment it has a 90 or 100% success rate of trading higher or lower over that period of days in the past 10 years).
When it finds those securities with the percentage success rate it will then calculate the average price move amount.
What to do with Money Calendar
We then take the avg. profit amount or what we deem is the avg. price move and extrapolate that out and add that number to the current or close price of the stock to anticipate a future price target.
It also shows the number of days this security takes to make that move and we analyze up to those patterns or price moves up to the next 30 days. We show these patterns up to and including the next 30 days.
To reiterate, Money Calendar looks for stocks that have a history of trading higher 9 or 10 of the pasts 10 years over a consistent period of days calculating the price from the open price on one date to the close price on an end date.
One can either trade the stock long or short, depending on if the pattern is bullish or bearish.
One can consider trading a bullish or bearish option strategy like a long call or long put.
Below is an example of the data that my tools provide you – this is the Money calendar data you find by using that scan.
Money Calendar Bullish Pattern and Date Example on UNH
UnitedHealth Group, Inc. (NYSE: UNH)
UNH is in the Health Care Sector. They operate as a diversified health care company in the U.S.
They operate through four segments: UnitedHealthcare, Optum Health, Optum Insight, and Optum Rx.
We like to find Money Calendar patterns on stocks at or within 10% of their 52-week highs anticipating strength begetting more strength. That is the case right now with UNH.
Also note, earnings already reported April 14 so that isn’t anything we have to contend with on this situation.
Provide feedback if you want to see more of this type of data and analysis and we can add more depth to the education on this tool and discuss in future write ups options scenarios around this type data.
App: Toms Option Tools
Market Insight articles may show images of lists of stocks meeting a variety of options parameters like Unusual Call and or Put activity or Expensive IV found on my app Toms Option Tools.
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