Perion Network

My final earnings short-squeeze trade idea today is digital media player Perion Network ( PERI), which is set to release numbers on Wednesday before the market open. There are currently no Wall Street analysts' estimates available for Perion Network.

The current short interest as a percentage of the float for Perion Network is rather high at 10.9%. That means that out of the 6.6 million shares in the tradable float, 1.01 million shares are sold short by the bears. This is a low float and high short interest situation, so any bullish earnings news could easily spark a big move higher for shares PERI post-earnings.

From a technical perspective, PERI is currently trending above its 200-day moving average and just below its 50-day moving average, which is neutral trendwise. This stock has been trending sideways for the last month and change, with shares moving between $10.35 on the upside and $8.56 on the downside. A high-volume move above the upper-end of that range will likely trigger a major breakout trade for shares of PERI post-earnings.

If you're in the bull camp on PERI, 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 $9.64 to $10.35 a share with high volume. Look for volume on that move that hits near or above its three-month average volume of 416,317 shares. If that breakout triggers, then PERI will set up to re-test or possibly take out its next major overhead resistance levels at $11.65 to $13 a share.

I would simply avoid PERI 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 $9 to $8.56 a share with high volume. If we get that move, then PERI will set up to re-test or possibly take its next major support levels at $7.63 to $6.50 a share.

To see more potential earnings short squeeze plays, check out the Earnings Short Squeeze Plays portfolio on Stockpickr.

-- Written by Roberto Pedone in Winderemere, Fla.


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At the time of publication, author had no positions in stocks mentioned.

Roberto Pedone, based out of Windermere, Fla., is an independent trader who focuses on technical analysis for small- and large-cap stocks, options, futures, commodities and currencies. Roberto studied international business at the Milwaukee School of Engineering, and he spent a year overseas studying business in Lubeck, Germany. His work has appeared on financial outlets including and You can follow Pedone on Twitter at or @zerosum24.

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