ADBE trade ideas
Adobe to spike on Adobe Max Conference, 2018I believe the risk / reward ratio on Adobe is a good swing trade at the moment. The Adobe Max Conference is coming up in a few days, and historically Adobe stock has benefited from this. There is speculation about a possible Photoshop for iPad release as well, which could give investors a lot of hype.
Bears eyeing ADBE divergenceADBE has been a beast for a long time, but there are signs the bulls may be exhausting. The daily chart is looking toppy with upper wicks of profit taking and clear resistance at 272.50, and a potential bearish reversal Head & Shoulders pattern forming on the daily. The support to break is 257 to confirm the pattern.
The daily chart is setting up minor RSI bearish divergence and pretty significant MACD bearish divergence.
This is one I'm going to wait for to come to me. Bearish RSI and MACD divergence on the weekly can be seen going back to November 2017 and the odds are always against the bear standing in front of a bull stock at all time highs. Any bears who took this short at the first sign of the divergence have long become insolvent.
The Gottcha ADBE TrendThe ADBE Trend is one that is often a “gottcha” for new swing traders. The problem is trading leadership. The runs are not initiated by Dark Pools or Pro Traders. The runs are initiated by smaller funds using VWAP or, worse, the retail crowd. The retail crowd is more emotional, has less experience and minimal training. Therefore, the runs they create are harder to trade. Try to avoid trading stocks that lack strong runs. Strive to trade with the Pro Traders, as the follow-through of the run is more reliable and the profits are usually much higher. This is not the ideal stock for swing trading at this time.
Martha Stokes, CMT
Adobe: in watchlist for next week.270-272 is a resistance level: my forecast is that adobe will not breach this area today 2018-09-14.
I'll add ADBE in my watchlist for next week because, after a retracement (down from overbought area of stochastic), will go long and will break the resistance area 270-272.
ADBE to Release Earnings on September 13Adobe Systems Incorporated (ADBE) is scheduled to release earnings on September 13, 2018, after the market closes, and will hold a conference call at 5:00 PM ET on the same day. The stock currently trades at 265.37, which is 5.4% higher than the close following its last reported earnings, trading with a range of 235.87 to 269.96 since that time.
Expected Price Volatility
Currently, option traders are expecting a ± 4.5% move for this earnings, and during the previous earnings release, the stock experienced a -2.4% move. Over the last 12 quarters, the absolute average move has been ± 3.3%, with a minimum move of 1.2% and a maximum move of 7.1%. ADBE has only experienced 3 larger-than-expected earnings moves in the last 12 quarters.
Earnings Price Pattern
The MarketChameleon earnings price pattern has detected two notable historical trends.
1 Week Before Earnings:For 11 of the last 12 quarters (92%), ADBE stock price has gone up in the week before earnings. It has had an average gain of +1.9% during that span.
2 Weeks After Earnings:For each of the last 5 quarters, the stock price has gone down in the 2 weeks following earnings. Over that period, it has an average loss of -2.4%.
Earnings Option Strategies
MarketChameleon's option strategy analysis shows that selling out-of-the-money puts the day before earnings had 83% winning occurrences, for an average gain of +67.7%. Additionally, selling at-the-money straddles resulted in 75% winning occurrences, for an average return of +24.8%.
EPS Estimate
Analysts are currently expecting ADBE to report an earnings of $1.69 per share, compared to $1.10 for the same quarter last year. Revenue is expected to come in at $2.2 billion versus $1.8 billion for the previous year.
Selling Adobe sharesAt the hourly chart of ADBE, the price is in a corrective wave after a bearish impulse, as it had recently rebounded from the 61.8 Fibo level. Also, a sell signal was formed in a form of the latest fractal. Breakdown of its level would be an optimal level to open short with SL at the peaks of the correction.