Apogee Enterprises

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One potential earnings short-squeeze trade in the industrial goods complex is Apogee Enterprises ( APOG), which is set to release numbers on Tuesday after the market close. This company is involved in the design and development of value-added glass products, services and systems. Wall Street analysts, on average, expect Apogee Enterprises to report revenue of $160.74 million on earnings of 3 cents per share.

The current short interest as a percentage of the float for Apogee Enterprises stands at 4.3%. That means that out of the 28.08 million shares in the tradable float, 1.19 million shares are sold short by the bears. The bears have also been increasing their bets from the last reporting period by 30.4%, or by about 276,000 shares. If the bears are caught learning too hard into this quarter, then we could easily see a large short-squeeze develop for shares of Apogee Enterprises.

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From a technical perspective, APOG is currently trading above both its 50-day and 200-day moving averages, which is bullish. From April to mid-May, this stock uptrended strong from $12.10 to a high of $16.34 a share. During that move, shares of APOG made higher lows and higher highs, which is bullish technical price action. After that run, shares of APOG have now started to trend sideways between $14.14 and $15.35 a share. A move outside of that range post-earnings should set this stock up for its next major trend.

If you're bullish on APOG, then I would wait until after they report and look for long-biased trades if this stock can manage to trigger a break out above some near-term overhead resistance at $15.35 a share with high volume. Look for volume on that move that hits near or above its three-month average volume of 150,488 shares. If we get that action, then APOG could take out its 52-week high of $16.44 a share.

I would avoid APOG or look for short-biased trades if after earnings this stock fails to trigger that breakout, and then drops below its 50-day moving average of $14.72 and below some major support at $14.14 a share with high volume. If we get that move, then target a drop in APOG towards $13 to $12 a share if the bears slam this stock lower post-earnings.

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