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TheStreet Open House

5 Earnings Short-Squeeze Plays to Consider

From a technical perspective, TLYS is currently trending below its 50-day moving average, which is bearish. This stock has been downtrending for the last three months and change, with shares falling from a high of $19.57 to a recent low of $14.43 a share. During that move lower, shares of TLYS have been mostly making lower highs and lower lows, which is bearish technical price action. That said, the stock has now started to rebound sharply off that recent low and it's quickly moving within range of triggering a near-term breakout trade.

If you're bullish on TLYS, then I would wait until after its report and look for long-biased trades once it manages to break out above some near-term overhead resistance levels at $16.32 to $71.15 a share with high volume. Look for volume on that move that registers near or above its three-month average action of 104,814 shares. If that breakout triggers, then TLYS will set up to re-test or possibly take out its next major overhead resistance levels at $18.45 to $19 a share. Any high-volume move above those levels will then set up TLYS to take out its all-time high of $19.57 a share.

I would avoid TLYS or look for short-biased trades if after earnings it fails to trigger that breakout, and then drops back below some key near-term support levels at $14.43 to $13.70 a share with high volume. If we get that action, then TLYS will set up to enter all-time low territory below $13.70 a share.

GasLog

Another earnings short-squeeze candidate is the GasLog (GLOG), which is set to release numbers on Wednesday before the market open. This company is an owner, operator and manager of liquefied natural gas (LNG) carriers providing support to international energy companies as part of their LNG logistics chain. Wall Street analysts, on average, expect GasLog to report revenue of $16.95 million on earnings of 4 cents per share.

This stock has been downtrending modestly heading into earnings, with shares off by around 11% so far in 2012. Shares of GasLog are currently trading just two points off its 52-week low of $8.76 a share ahead of its report.

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