Technical Trading Software's Surprising GoPro Projection

GoPro Inc GPRO traders are scrambling to decide how to play the company’s earnings report coming after the market close. Fundamental and technical traders have likely been pouring over countless metrics for days trying to determine what to expect from GoPro’s earnings report.

Similar patterns
One website, EidoSearch, takes a unique approach to predicting future stock movement. The EidoSearch software focuses on identifying time periods in the past when stocks have traded most similarly to recent trading action.

EidoSearch’s software predicts a share price of $45.44 for GoPro by May 4, a modest 2.8 percent drop from recent trading levels. EidoSearch’s upside price limit is $48.44, and its downside price limit is $42.44 percent.

Earnings history
A mere 2.8 percent move would likely coma as a surprise to many traders based strictly on GoPro's brief earnings history. Long-time GoPro shareholders are used to major earnings volatility. In fact, GoPro has averaged a more than 13.6 percent move on the day following its three previous earnings reports.

Unfortunately for traders, while the magnitude of GoPro’s earnings moves has been huge, the direction of the moves has been unpredictable. So far, two of the post-earnings moves have been to the downside and one has been to the upside for an average overall return of -5.0 percent.

More earnings facts
GoPro’s most recent earnings report resulted in a 13.3 percent drop in share price the following day.

GoPro’s only up move on the day after earnings was a 13.0 percent jump in October, 2014. The biggest down move has been a 14.6 percent drop following the company’s very first earnings report back in July, 2014.