You only need a few good trades a year to perform well. NET has been one of those good trades and we have over 500% return on this trade.
Price is now in at a 50% drawdown and has earnings due this week so it will be a pivotal point in time for this stock.
Earnings is a lottery and we have no control over the report or the reaction. However, we do have full control over the risk prior to earnings so reducing exposure is one way to deal with that.
The good – Price is currently dealing above the support level from Feb 2001 and the Figure.The bad – Price has not broken any recent resistance levels so we might be looking at a BrF forming.
Whatever the current price action, you might want to take some action or reaction.
If you are sitting on good profit, taking some off the table might be the action.
If you feel there is more room for price to run up and the drawdown has been substantial enough, then managing the trade after earnings might be the reaction.
Be prepared and know how you want to deal with your trades before the earnings are released.
Let’s go trade!