I would avoid TXI or look for short-biased trades if after earnings it fails to trigger that move, and then drops back below some key near-term support levels at $62.50 a share to its 50-day moving average at $60.32 a share with high volume. If we get that move, then TXI will set up to re-test or possibly take out its next major support levels at $57.50 to $55.80 a share.
My final earnings short-squeeze play is retail discount store and full-service pharmacy operator
(FRED - Get Report)
, which is set to release numbers on Thursday before the market open. Wall Street analysts, on average, expect Fred's to report revenue of $533.94 million on earnings of 20 cents per share.
The current short interest as a percentage of the float for Fred's is pretty high at 10.6%. That means that out of the 33.10 million shares in the tradable float, 3.62 million shares are sold short by the bears. The bears have also been increasing their bets from the last reporting period by 5.9%, or by about 199,000 shares. If the short-sellers are caught leaning too hard into a solid quarter, then we could easily see shares of FRED rip higher post-earnings.
From a technical perspective, FRED is currently trending above both its 50-day and 200-day moving averages, which is bullish. This stock has been uptrending strong for the last two months and change, with shares soaring higher from its low of $12.25 to its recent high of $14.53 a share. During that uptrend, shares of FRED have been mostly making higher lows and higher highs, which is bullish technical price action. That move has now pushed shares of FRED within range of triggering a major breakout trade post-earnings.
If you're in the bull camp on FRED, 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 levels at $14.53 to $15.54 a share with high volume. Look for volume on that move that hits near or above its three-month average volume of 210,920 shares. If that breakout triggers, then FRED will set up to enter new 52-week-high territory above $15.98, which is bullish technical price action. Some possible upside targets off that breakout are $17 to $20 a share.