How to Trade Wednesday's Earnings, Including Garmin

NEW YORK (TheStreet) -- Today we crunch the numbers on 11 companies that report their quarterly earnings reports on Wednesday. Seven report before the opening bell, and four report after the closing bell.

Rather than profile each stock individually, I crunch the numbers in the tables for you. (See pages 2 and 3 for the tables.)

The biggest year-to-date gainer is Garmin (GRMN) ($54.71), up 18% so far this year. Analysts' expect the maker of navigation devices to report earnings per share of 44 cents before the open bell on Wednesday. The stock set a multiyear intraday high at $58.21 on March 27 and closed Monday between its 50-day simple moving average at $54.24 and its and 21-day simple moving average at $55.80.

The weekly chart is positive but overbought, with the five-week modified moving average at $53.87. Investors could have sold strength to our annual risky levels at $57.49 and $57.51 at the March 27 high. Monday's high was just below our weekly pivot at $55.60 with semiannual value levels at $48.43 and $44.99.

The stocks with modest year-to-date gains are trucker Con-way (CNW), up 5.7%; integrated oil & gas company Hess (HES), up 4.7%; and health benefits provider WellPoint (WLP), up 2.6%.

The biggest year-to-date loser in today's tables is social media company Yelp (YELP) ($55.55), down 19%. Analysts expect the company to report a loss of 6 cents a share after the closing bell on Wednesday. The stock set an all-time intraday high at $101.75 on March 5 then traded as low as $52.40 on Monday.

The weekly chart is negative but oversold with its five-week MMA at $67.53. This recent IPO does not have enough price history to have a 200-week SMA. A weekly value level is $50.36 with a monthly risky level at $100.37.

The second biggest year-to-date loser is Lumber Liquidators (LL) ($84.75), down 18%. Analysts expect the company to report earnings per share of 63 cents before the opening bell on Wednesday. The stock set its 2014 intraday high at $111.74 on Feb. 26 then traded as low as $82.16 on April 15.

The weekly chart is negative but oversold with its five-week MMA at $90.60. Weekly and semiannual value levels are $77.86 and $75.77, respectively, with monthly and quarterly risky levels at $104.89 and $126.56, respectively.

The third biggest year-to-date loser is General Cable (BGC) ($25.16), down 14.5%. Analysts' expect the provider of copper, aluminum and fiber optic cable products to report a loss of 8 cents a share after the closing bell on Wednesday. The stock set its 2014 intraday high at $31.50 on Feb. 21 then traded as low as $24.74 on April 11.

The weekly chart is negative but oversold with its five-week MMA at $26.42 and its 200-week SMA at $31.31. Semiannual and weekly value levels are $23.59 and $22.46, respectively, with monthly and quarterly risky levels at $27.21 and $29.32, respectively.

Summarizing the first "Crunching the Numbers" table we see one stock with rising stochastics, two stocks overbought, five with declining stochastics and three oversold. Five are above their five-week modified moving averages and six are below.

Summarizing the second "Crunching the Numbers" table we see that only one stock is trading under the influence of a monthly pivot that expires on Thursday. Three have weekly pivots, but that's only a potential influence this week.

Your investment policy among these stocks depends on whether or not you are a buyer on weakness or a seller of strength. We advocate using good 'til canceled limit orders to buy weakness to a value level or to sell strength to a risky level.

Crunching the Numbers With Richard Suttmeier: Moving Averages & Stochastics

This table provides the technical status for the stocks profiled in today's report.

There are five columns with moving average titles: Five-Week Modified Moving Average; 21-Day Simple Moving Average; 50-Day Simple Moving Average; 200-Day Simple Moving Average; and the 200-Week Simple Moving Average.

The column labeled 12x3x3 Weekly Slow Stochastics shows the pattern on each weekly chart with a reading of oversold, rising, overbought, declining or flat.

Interpretations: Stocks below a moving average are listed in red.

Five-Week Modified Moving Average (MMA) is one of two indicators that define whether a weekly chart profile is positive, neutral or negative. The other is the status of the 12x3x3 weekly slow stochastic.

A stock with a positive technical rating is above its five-week MMA with rising or overbought stochastics.

A stock with a negative technical rating is below its five-week MMA with declining or oversold stochastics.

A stock with a neutral technical rating has a profile that is not positive or negative.

The 200-Week Simple Moving Average (SMA) is considered a long-term technical support or resistance level and as a "reversion to the mean" over a rolling three- to five-year horizon. (Even Apple (AAPL) declined to its 200-week SMA in June 2013.)

The 21-Day Simple Moving Average is a short-term technical support or resistance used by many hedge fund traders to adjust positions. A stock above its 21-day SMA will likely move higher over a rolling three- to five-day horizon and vice versa.

The 50-Day Simple Moving Average is also a technical support or resistance used by many strategists and commentators in financial TV.

The 200-Day Simple Moving Average is another technical support or resistance level, and I consider this level as a shorter-term "reversion to the mean" over a rolling six- to 12-month horizon. (Even Apple tested or crossed its 200-day SMA in nine of the last 10 years.)

Crunching the Numbers With Richard Suttmeier: Earnings & Where to Buy & Where to Sell

This table presents the EPS estimates including date and before or after the close, and where to buy on weakness and where to sell on strength.

"EPS Date" is the day the company reports its quarterly results.

"EPS Estimate" is the EPS estimate from Wall Street analysts.

Value Levels, Pivots and Risky Levels are calculated based upon the last nine weekly closes (W), nine monthly closes (M), nine quarterly closes (Q), nine semiannual closes (S) and nine annual closes (A). I have one column for pivots, which is a magnet for the period shown. The columns to the left of the pivots are first and second value levels. The columns to the right of the pivots are first and second risky levels.

Investors who wish to buy a stock should use a good-'til-canceled limit order to buy weakness to a value level. Investors who want to sell a stock should use a GTC limit order to sell strength to a risky level.

At the time of publication the author held no positions in any of the stocks mentioned.

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This article represents the opinion of a contributor and not necessarily that of TheStreet or its editorial staff

Richard Suttmeier is the chief market strategist at ValuEngine.com. He has been a professional in the U.S. Capital Markets since 1972, transferring his engineering skills to the trading and investment world.

Suttmeier has an engineering degree from Georgia Tech and a Master of Science degree from Brooklyn Poly. He began his career in the financial services industry in 1972 trading U.S. Treasury securities in the primary dealer community. He became the first long bond trader for Bache in 1978, and formed the Government Bond Department at LF Rothschild in 1981, helping establish that firm as a primary dealer in 1986. This experience gives him the insights to be an expert on monetary policy, which he features in his newsletters, and market commentary.

Suttmeier's industry licenses include, Series 7 and Registered Principal (Series 24). He has been the Chief Market Strategist for ValuEngine.com since 2008 and often appears on financial TV.

Click here for details on Suttmeier's "Buy and Trade" investment strategy.

Richard Suttmeier can be reached at RSuttmeier@Gmail.com

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