With Q4 earnings season in full swing, Tui, General Motors, and Ted Baker provide us with interesting trading opportunities.
This article looks at some of the big movers off the back of recent earnings announcements to try and find stocks that seem to provide a good trading opportunity. Typically, earnings announcements and trading statements will drive a shift or enhancement of market sentiment. While many see earnings as a significant risk when holding a stock, placing trades in the wake of such events allows for greater confidence that all market knowledge has been factored into current prices.
TUI
TUI AG has been hit hard over the course of the week, with the stock hitting a three-month low. Certainly, travel stocks like this remain stuck between the fear of a continued cash burn and the optimism of an economic reopening.
The daily chart highlights how the stock has reached a critical zone of support, with an ascending trendline coming into play here. A break below the trendline and particularly the £2.65 support level would bring a wider bearish picture into play. However, until that happens, there is a good chance we see the bulls come back into play around these levels as the sector looks ahead to the positive effects of the vaccination efforts. A push through £3.61 would raise optimism for bulls.
General Motors
While Tesla has become the posterchild of the auto sector, General Motors (GM) has also enjoyed remarkably strong 12 months. While the stock hit a fresh record high on Wednesday, we saw a subsequent pullback in the price. However, the clear uptrend highlights the expectation of further upside from here. As such, bullish positions are favoured, with a break below $47.68 required to bring about a more negative outlook for GM.
Ted Baker
The selling pressure has failed to let up for Ted Baker, with the clothing retailer falling into a fresh three-month low today. This is just the latest leg lower within a reliable downtrend that has been playing out since the November peak of £1.49. However, the price is falling into a notable inside trendline here, with a chance we could see a short-term rebound as a result. From a wider perspective, there is a chance we are retracing despite the break below 76.4% support. However, given the clear and obvious recent downtrend, it would make sense to look for a break through £1.12 to raise expectations of a bullish resurgence. Until then, any short-term upside could be sold into once more.
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