Earnings Bullish/Bearish

Strategy Name: Earnings

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Strategy Description: Earnings is a precision-calibrated strategy built to capitalize on sharp price movements following earnings announcements or other high-volatility events. This dual-directional setup combines technical signals with volume dynamics to identify unusually large price swings accompanied by heavy trading activity—often a sign that the move may have further to go. While others might view these extremes as overbought or oversold levels, this strategy is designed to test whether the momentum is just beginning.

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Core Setup: Overbought Long Trigger:

• Price Breakout: Price must cross above the upper Bollinger Band, signaling an abnormally ‘large’ move up.

• Momentum Spike: RSI (14) must exceed 70, flagging an overheated market condition. However, with OBV configured to be positive, this may indicate buyers willing to buy at extreme moves, expecting the stock to go higher.

• Volume Confirmation: On Balance Volume (OBV) must be positive, confirming bullish volume pressure.

Oversold Short Trigger:

• Price Breakdown: Price must cross below the lower Bollinger Band, signaling an abnormally ‘large’ move down.

• Momentum Drain: RSI (14) must fall below 30, highlighting oversold conditions. However, with OBV configured to be negative, this may indicate sellers willing to short/sell at extreme moves, expecting the stock to go lower.

• Volume Confirmation: OBV must be negative, reflecting net selling pressure.

Profit Target & Risk Control:

• Take Profit: +0.75%

• Stop Loss: -1.0%

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This slightly asymmetric reward-to-risk ratio reflects a tactical approach—tight enough to limit exposure, but wide enough to allow natural volatility to play out.

Ideal For:

• Traders seeking to capitalize on extreme moves with heavy volume.

• Earnings-driven stocks with sharp post-news volatility.

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Earnings is designed for traders who thrive in volatile earnings environments. It spots opportunity where others see exhaustion, and executes with the speed and confidence required in fast-moving markets.

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Next steps:

1. Make this strategy your own – click here to customize to suit your preferences.

2. Try this strategy on a different asset or timeframe -

   1. Navigate to the “Create” menu on the homepage, choose your preferred asset and timeframe, then choose “Copy” to duplicate the strategy.

   2. From there, backtest and deploy whenever you're ready.

   3. Reach out to the Level2 team with any questions or if you need tech support

The template strategies provided on Level2 are for educational and illustrative purposes only and do not constitute investment advice or a recommendation to trade. These strategies are based on historical examples and are not tailored to your individual financial circumstances, objectives, or risk tolerance.

Before deploying any strategy, you must run a back-test using your chosen security. Strategy performance can vary significantly depending on the asset class, time frame, volatility, and broader market conditions. It is essential to adjust parameters such as entry/exit levels, indicators, and time frames to suit the specific security and current market dynamics.

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