If you're bullish on NOW, then I would wait until after its report and look for long-biased trades if this stock manages to break out above its all-time high at $55.46 a share with high volume. Look for volume on that move that hits near or above its three-month average action of 1.50 million shares. If that breakout hits, then NOW will set up to enter new all-time high territory, which is bullish technical price action. Some possible upside targets off that breakout are $65 to $70 a share.
I would simply avoid NOW 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 $52 to its 50-day moving average of $49.02 a share with high volume. If we get that move, then NOW will set up to re-test or possibly take out its next major support levels at $46 to $42 a share.
My final earnings short-squeeze play is online travel research player TripAdvisor (TRIP), which is set to release numbers on Wednesday after the market close. Wall Street analysts, on average, expect TripAdvisor to report revenue of $257.97 million on earnings of 45 cents per share.The current short interest as a percentage of the float for TripAdvisor is very high at 15%. That means that out of the 111.67 million shares in the tradable float, 16.71 million shares are sold short by the bears. If the bulls get the earnings news they're looking for, then shares of TRIP could rip sharply higher post-earning as the bears rush to cover some of their bets. From a technical perspective, TRIP is currently trending above its 200-day moving average and just below its 50-day moving average, which is neutral trendwise. This stock has uptrending modestly for the last month, with shares moving higher from its low of $68.11 to its recent high of $75.43 a share. During that move, shares of TRIP have been mostly making higher lows and higher highs, which is bullish technical price action. That move has now pushed shares of TRIP within range of triggering a near-term breakout trade post-earnings.
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