From a technical perspective, SRPT is currently trending above both its 50-day and 200-day moving averages, which is bullish. This stock has been uptrending for the last month, with shares moving higher from its low of $25.80 to its recent high of $32.40 a share. During that uptrend, shares of SRPT have been mostly making higher lows and higher highs, which is bullish technical price action. That move has started to push shares of SRPT within range of triggering a major breakout trade.
If you're bullish on SRPT, then I would wait until after its report and look for long-biased trades if this stock manages to break out above some near-term overhead resistance at $32.40 a share with high volume. Look for volume on that move that hits near or above its three-month average action of 1.31 million shares. If that breakout triggers, then SRPT will set up to re-test or possibly take out its next major overhead resistance levels at $35 to $40 or even $45 a share.
I would avoid SRPT 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 $28.35 to its 50-day at $26.96 a share with high volume. If we get that move, then SRPT will set up to re-test or possibly take out its next major support levels at $25.80 to $23.46 a share.
Vail ResortsAnother earnings short-squeeze candidate is mountain resort operator Vail Resorts (MTN - Get Report), which is set to release numbers on Wednesday after the market close. Wall Street analysts, on average, expect Vail Resorts to report revenue of $414.13 million on earnings of $1.70 per share. The current short interest as a percentage of the float for Vail Resorts is notable at 7.5%. That means that out of the 35.39 million shares in the tradable float, 2.67 million shares are sold short by the bears. The bears have also been increasing their bets from the last reporting period by 3.5%, or by about 90,000 shares. If the shorts are caught being too aggressive into a strong quarter, then shares of MTN could rip higher post-earnings.
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