We were sitting on a rooftop when a firework ricocheted near us and hit my friend on the ankle.
It didn’t do any damage, so we stayed on the hotel’s roof, rapt in wonder, watching hundreds of fireworks burst around the bay of Peru’s Lake Titicaca.
Yellow, red and green explosions threw stars into the sky. And I was immeasurably grateful that I was able to kick off my 2018 with this spectacle.
I think we all get that feeling on New Year’s Eve. That awe, that excitement, that idea that great things are yet to come.
Sometimes that feeling goes away within a couple of weeks. But not this year. This year, the markets are telling many analysts that yes, great things are in store for those who know where to look…
Because we’re in for an incredibly strong bull market.
Earnings Season Ignites 2018’s Bull Market
See, Banyan Hill Publishing’s systems analyst Michael Carr just announced that the stock market is set to rise 40% or more this year.
And part of that boost will come from the fourth-quarter earnings season, which just kicked off this week.
As we can already see in just a couple days, this is gearing up to be a seriously strong earnings season. Delta Air Lines Inc. (NYSE: DAL) and KB Home (NYSE: KBH) both beat expectations, which boosted their stocks to new highs. Likewise, big banks Wells Fargo & Co. (NYSE: WFC) and JPMorgan Chase & Co. (NYSE: JPM) beat forecasts.
And that’s just the beginning.
According to UBS strategist Keith Parker, S&P 500 gains are expected to rise 11.2% for the quarter — the second-strongest period of earnings growth since 2011. Every single one of the 11 sectors in the S&P 500 should report growth in earnings and revenue. (Energy is expected to be the best this season, by the way.)
So you might be asking yourself: OK, that’s all well and good, but how can I profit from this?
The Key to Profiting From Strong Earnings
My recommendation is to follow this earnings season closely. Do your research. Review the forecasts. Find a quick-hit call option strategy that will let you benefit from companies known to pop from this season’s reports.
Because there will most certainly be rallies here that can be scooped up if you have the right timing.
This past week, Chad scooped up a gain of more than 500% from an earnings-related play on Thursday. Yep, a whopping 500%.
For example, one reader wrote: “I bought four contracts at $4.20 each and sold at $28.95 each for a total profit of $9,900, or 589%!”
Another wrote: “What a success! I kept buying, so I ended up with an average price of $2.81 — and a total gain of 935%. I have no words to describe the success, but I think you are a genius.”
Of course, you won’t see 500%-plus gains every day. Don’t trust anyone who says you will. They probably want to sell you the Brooklyn Bridge too.
But the fact that it’s possible means this is the ideal strategy as we head into the second-strongest earnings season since 2011 — and as we kick off a great 2018.
I hope everyone’s 2018 is starting off as well as this season.
Catch you next week.
Managing Editor, Banyan Hill Publishing