August is seasonally a weak month, especially in the beginning.
However, in mid-August, things can pick up. The market becomes a bit more bullish and we get the holy “summer rally,” which isn’t that great. Anyway, expect this week to be lackluster but do prepare to open some long positions at the end of the week: at Thursday’s close or Friday’s open.
We have a number of interesting earnings trades coming up. Here’s the preview for the week, day-by-day:
For earnings we have RAX, COH, and INCY.
INCY is an interesting one because of how overpriced it is. The stock is up 30% since last earnings’ report, and analysts have high expectations. However, if INCY misses, it will fall hard. RAX shows a similar pattern, while COH is rather boring in its earnings movements.
KORS, another retail stock, reports on Tuesday. KORS almost always beats on earnings. The question is whether the stock will respond to an earnings beat – here, future guidance is of the utmost importance.
Absolutely nothing interesting today…
This day is seasonally a bearish day. Thursday close is a good entry point if you’re looking for a bullish rebound. It’s also a good day to simply daytrade downward. As for earnings, we have NVDA and JWN. Nordstrom is one of those stocks analysts simply do not grasp. So many times have analysts been wrong on the EPS predictions, usually being overly optimistic.
No interesting earnings plays, but Friday is bullish day, seasonally. This a good day to daytrade in a bullish direction or to open a bullish position for the next week, which is also seasonally bullish.