Telephone & Data Systems Post Earnings Plan

Chicago based Telephone and Data Systems, $TDS, reports earnings before the open Friday, heading into that report the stock has recovered 50% of the move lower from March and is approaching resistance at 24.70. The options market is pricing in a move of about $1.50 over the next two weeks, or 6.25%. An earnings catalyst can swing a stock either way though. So how do you prepare?

The chart above shows a RSI that is bullish and rising with a MACD that is also positive. With the price action it has an upside bias to it. A favorable report and the resistance higher is found at 24.70 and then the 61.8% Fibonacci retracement at 25.34. This lines up very well with the 6.25% move forecast by the options market which would take it to 25.50. If it does start moving higher in the premarket look for it to stall at that level. Take profits if it goes through. If however the report is not interpreted well, then there is the 38.2% Fibonacci lower at 22.99 and support lower at 22.30. This is just below the 6.25% projected move at 22.50 and a good spot to take short sale profits. A break below there could see the next support level at 21.50 followed by 20.30 and 19.20. Now you are ready.

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The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.

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