It looks like Snow might have bottomed. It has been slowly clawing back up. It reports in 8 days and we will see if it can come back. It had a stage one cup pattern and looks to be building another cup if in 8 days it reports a nice earnings we could see the right side firming up.
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Things I have picked up from IBD discussions
Bill would never look at a stock below the 200dma.
This new base would be a stage 1 since it undercut the last base, but it is too far from a new high.
If this built a right side that approached the old highs, the base would be flawed because it was way too deep.
The rankings are very poor, Bill would never touch this stock here.
This could be a bottoming base, and some of the IBD folks will buy that, but Bill would not.
Me:
We could hope it builds a nice right-side, with good institutional accumulation and then forms a handle under 200dma resistance. Then a breakout on strong volume would also take it above the 200dma. Maybe by that time the 50dma would be approaching the 200 because we really need to see that give us a “golden cross”.
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Andy, take a look at the SE chart. It had a huge decline like SNOW, and it is basing into a comeback. While it is way off its highs, it has been consolidating long enough that the 50 is above the 200 and the price is above the 50 and the RS is 97. 21dma still below 50.
I would argue that we should wait for SNOW to look more like that. If SNOW is going to be a great long-term stock and get back to all time highs, then we can wait for a better setup than we will likely see over next few months.
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To late I already bought into Snow at $121.61 on 8/2/24. I want to own this stock again. But depending on how it is doing before earnings is how I am going to play it. If I do not have enough cushion I will probably sell out or at least write some calls. I have been watching SE but I want it to break out of it’s stage one consolidation. Maybe tomorrow?
I agree with you Pete, Snow has a very dirty IBD chart.
But SS doesn’t look to bad
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I bought some SE on the break above the 50dma today and will add on a breakout tomorrow.
SS chart for SNOW is not relevant if you want to be a long term holder. If you want to be an MF-like long term holder of a great stock, yes, start scaling in now and plan to hold 3-5 years.
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Sorry Pete I didn’t mean to say I was a long term holder. Just a holder looking for more gains.
Unless you have a strong fundamental understanding and a strong view on the earnings, don’t initiate a position (stock or options) before earnings. It is just not worth it. You may get lucky few times. Every technical analyst will tell you earnings re-sets the chart.
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That is very good advice Kingran but since we are always before earnings we have to decide how much time before earnings a position can be opened? Let’s say I open a position and am up 20 percent before earnings. Is that enough of a cushion? Possibly for most stocks but not necessarily for Snow. Although it is at the lowest P/S it has ever traded at. I think a P/S of 13 is a good place to start. When it gets closer to earnings I will make a decision on how to play it.
I guess probably you picked up $SNOW last Monday to have 20% gain. If the position is not big, don’t hedge, don’t sell calls, just ride it. My only concern was this quarter could be a kitchen sink quarter. Of course my opinion means nothing.
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Kingran I am only up around 5 percent, that was a what if.
I thought last quarter was the Kitchen Sink. Every since they changed CEO’s they have been treading water and everyone has been saying how Databricks has been eating their lunch. I was going to sell a call for strike of $129 but I agree it is such a small amount of money for the possibilities.
Separately, the market may not re-test 8/5 but market bounce back from 8/5 is mostly in place, and VIX < 20, now , it may get choppy for sometime. Keep that in mind if you are thinking of making a decision few days before the call.
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Not a bad quarter or bad guidance and they have upped the buyback, yet the stock is down in after hours. Clearly 10 x PS may be fully valued, but we have seen many software names bottom at 4~5x PS. I think we should be prepared for this going further down.
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I see it the same way. I sold out before earnings because it was to risky but the quarter didn’t seem bad at all. Haven’t read the transcript yet.
Today WDAY declared results, the key is they acknowledge the growth is going to slow, however, they are talking about profitability. That is going to be reality to many software names. The growth is going to decelerate or reset. Now, can they talk about profitability? margin? That also means reducing employee expense.
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