Swing Trading Earnings Bullish Momentum With Options in EXCO Resources NL – CML News

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There is a pattern of bullish momentum in EXCO Resources NL (NYSE:XCO) stock just days before earnings, and we can track that by looking at swing returns in the option market. The strategy won’t work forever, it can be easily derailed by a couple of down days in the market irrespective of EXCO Resources NL news, and in fact, it hasn’t even won more often than it has lost, but since the profits from the winning trades are so much larger than the losing trades, that it has returned 10,670% annualized returns.

The idea is quite simple — trying to take advantage of a pattern in short-term bullishness just before earnings, and then getting out of the way so no actual earnings risk is taken. Now we can see it in EXCO Resources NL.