Trading Strategies For Plug Power Before And After Q3 Earnings

Plug Power, Inc PLUG is set to print its third-quarter (Q3) earnings after the markets close Thursday. The stock was trading near flat heading into the event.

When Plug Power printed mixed Q2 earnings on Aug. 9, the stock plunged about 15% the following day and continued to fall in its steep downtrend until reaching a bottom of $5.58 on Oct. 20 and Nov. 2.

For the second quarter, Plug Power reported a loss of 40 cents per share, missing a consensus estimate of a loss of 26 cents per share. The hydrogen company beat on revenues, posting $260.18 million, which came in above the $242.24-million consensus estimate.

For the third quarter, analysts, on average, estimate Plug Power will report a loss of 30 cents per share on revenues of $237.92 million. Read More Here...

Traders and investors will be watching closely to see if Plug Power provides positive guidance and forecasted growth for the fourth quarter.

From a technical analysis perspective, Plug Power's stock looks neutral heading into the event, having negated its downtrend but unable to regain the eight-day exponential moving average (EMA). It should be noted that holding stocks or options over an earnings print is akin to gambling because stocks can react bullishly to an earnings miss and bearishly to an earnings beat.

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The Plug Power Chart: Plug Power negated its downtrend on Nov. 3, when the stock reached a higher high of $6.74, which was above the most recent lower high of $6.54. On Wednesday, Plug Power was working to print a shooting star candlestick near the $5.93 level, which could indicate lower prices are on the horizon.

• If Plug Power receives a bullish reaction to its earnings print, Wednesday’s higher low will be confirmed and an uptrend may be on the horizon. If that happens, the stock will regain the eight-day and 21-day EMAs but may find resistance at the 50-day simple moving average, which is trending at about $7.20.
• If the stock suffers a bearish reaction to its earnings print, the higher high will serve as a bull trap and the downtrend is likely to accelerate. Should the stock fall under $5.58, it will trade at its lowest price since June 2020.
• Plug Power has resistance above at $7.39 and at $9.13 and support below at $5.58 and at the psychologically important $5 mark.

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