"When a chart fits my criteria and the company beats earnings, it's on my radar for a trade." Nate Bear, Lead Technical Tactician, Monument Traders Alliance Editor's Note: When should I get in on a stock? It's one of the first questions a beginner trader wants to know before making a trade. So today at 1 p.m., our Lead Fundamental Tactician Karim Rahemtulla is showing traders his process for developing a trade. He'll also reveal one of his most powerful signals for buying a stock. Click here to sign up for today's live masterclass for FREE. - Ryan Fitzwater, Publisher
When it comes to playing earnings, I prefer to look for companies that recently beat earnings and already have established momentum. Take Lemonade (LMND) for example. LMND recently beat earnings by a lot. It rallied 30% on Tuesday after reporting solid Q2 revenue and raising its full-year guidance. Now, I don't have a crystal ball. So I couldn't guess if LMND would beat earnings or not. But in all my years of trading experience, waiting until AFTER earnings to ride established momentum on a stock has been a proven way to generate consistent winners. That's what I did here with LMND. As you'll see in its chart above, LMND saw a big move up after earnings on Aug. 5. Then it consolidated for a bit before moving up again right after the opening bell yesterday morning. This is the "post-earnings surge" in action. And when you know what to look for in a chart, you can get positioned on the stock AFTER earnings to potentially capture more momentum. In the case of LMND, after it reported earnings I noticed on my S.A.M. Scanner that it had a perfect 15-minute chart. So I added some calls before the end of the day to potentially capture early Day 2 momentum. The stock moved up on Day 2 of earnings, and I added some more calls the following morning to continue riding the momentum. I also added some more right before lunch after noticing a strong consolidation pattern. I ended up closing for a 50% winner in 1 trading day. | 
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