Microsoft (MSFT) - Get Report reported earnings on Thursday after the stock market closed. Adjusted earnings per share came in at 62 cents, vs. expectations of 64 cents. Revenue was $22.08 billion, vs. estimates of $22.09 billion. In other words, the news was negative but only slightly. As often happens following earnings misses, the stock is selling off hard on Friday morning. Early in the session it was at $52.12, down $3.65, or 6.6%. This move likely is exaggerated, however, and investors can profit from the coming recovery using stock options.

The chart reveals a bull trend underway since mid-February in a 3-point channel range.

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If the stock recovers following a short-term selloff, there will be an exceptional opportunity for a bullish swing trade. Look for chances to buy call options or sell put options to exploit the erratic market behavior.

This article is commentary by an independent contributor. At the time of publication, the author held no positions in the stocks mentioned.

Besides blogging atTheStreet.com,Michael Thomsett alsoblogs at theSeeking Alphaand several other sites.He has been trading options for 35 years, and has also published a paper in the current issue of the Journal of Technical Analysis (JOTA) challenging commonly held beliefs about market efficiency and poses a trading system that can beat the market.