Netflix (NFLX) reported last week (10/15), investors we're quick to sell the stock down over 25%, on some disappointment, as the expectations had apparently gone to high.
Back on 10/09, Prior to earnings, Chaikin Analytics gave NFLX both an overbought sell and a relative strength breakdown signal.
I purchased the DEC 300 put for .56 cents.
As we all know now, NFLX disappointed and the stock sold off hard after hours. I got out of the trade at the open the day following earnings for 8.40. Net gain of 7.84 per contract for a three day trade.
While this is not the type of trade we usually initiate around earnings, the return on risk, the technicals AND the Chaikin Analytics edge gave me confidence in the trade.