3:54 PM – Selling my entire MNST position here just before today’s bell. The company is set to report earnings tomorrow after the close, and shares can begin to get volatile ahead of that event. Earnings reactions are unpredictable and often sharp. While I do occasionally take risk into announcements, with Monster here I’d rather lock in a quick +2.2% gain and move on.

I believe my entries — outlined below — were near perfect, and something both to practice and learn from. Each 1/3 position was executed on a clear bullish technical signal the stock provided.

The 2/17 breakout to new highs on a +37% increase in volume was the initial BUY SIGNAL. I personally entered, admittedly a little late, the following day with a 1/3 position.

My first 1/3 ADD came on the 2/20 advance from the 10 DMA to new highs on a +14% increase in volume — exactly what I look for and you want to see.

The continued bullish action the following session gave me one final opportunity to complete the position as shares pushed to new highs once again.

If it weren’t for tomorrow’s earnings report, I would still be holding MNST. The 10 DMA is just beginning to “line up,” as I say. That action is typically constructive ahead of a developing, continued uptrend, as I have pointed out many times with previous winning selections.

I do realize MNST could blast higher on tomorrow’s quarterly report, and that’s money I am going to be missing out on. However, there’s also an equal chance the stock gaps down and sells off.

Every trader’s portfolio goals evolve over time. My focus right now is aggressively growing account equity — which is currently at all-time highs — by rotating into quicker-moving opportunities as I’m currently finding plenty each week in this current market.

At this stage, I’m perfectly content hitting some quick singles and the occasional doubles — stacking modest, consistent wins. Those will drive my balance home and push my total runs higher.

I prefer my capital be positioned in strength and momentum — and as always remain there only while bullish technical signals persist.

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MY BUYS:
2/18 (1/3) @ $83.68
2/20 (1/3) @ $82.98
2/23 (1/3) @ $84.76

NEW COST BASIS: $83.81

MY SELLS:
2/25 (ALL) +$651.40 +2.2%

James’ Trader’s Tip: Earnings Volatility Is a Choice

    • Earnings reactions are often sharp and unpredictable.

    • Protecting a quick gain is disciplined risk management.

    • Capital should rotate into stocks showing current momentum.

    • Aggressive growth still requires controlled risk.

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