MU is expected to decline or underperform after earnings; short outlook based on need for exceptional profits and historical post-surge pullbacks.

Are you optimistic or pessimistic about Micron's earnings? We will take a look at the expected move tomorrow, because they will announce their results tomorrow, and that is exciting.

We will be looking at the MU index, but given the approaching earnings announcement date , we will also take a look at the SPX index.

I have a survey about MU to find out if you are optimistic or pessimistic. We will take a closer look at it. If you wish to postpone the vote, you can. We will review what is happening in the market in general.

Then we will take a look at MU specifically. Here's MU.

Part of the catalyst for this will be the performance of stocks and the earnings of companies like Micron. Therefore, my own expectations regarding Micron are that we will be somewhat pessimistic .

I will show you the profits of Micron company. Actually, we will first talk about Micron stock, and then I will show you the small data table that I have prepared.

This is largely in line with my expectations for Micron stock. Therefore, I believe there could be a significant price increase. If that happens, I think he will back down a little . Let's take a look at Micron's stock here.

We will take a look at some past earnings. Of the things that have happened between this report and the current earnings report, the market appears green here (if it is not obvious).

Here we see past earnings, here are current earnings , and here are upcoming earnings in purple, which will be released tomorrow. What we witnessed in the first quarter of this year was a rise in profits, then a slight stabilization in the second quarter, and then a decline after the distribution of profits.

After that, we saw a strong rise in price. This surge peaked in the current earnings report , which created a significant price gap. We have seen significant fluctuations before this, with the stock frequently rising and falling. So, the price rose and then fell.

What interests me is the time period that followed the earnings announcement itself. It's not the announcement itself, but the period that followed it. So, I wanted to look at it from a valuation perspective, since many companies are asking for a valuation close to $1,300.

So, if we look at it that way, this might be the maximum price we could be looking at. But what I expect is that we need exceptional profits. They will achieve...what is the number?

$51 billion? $51 billion, or $50 billion is the forecast, and the market forecast is $51.5 billion . Therefore, we actually need to exceed profit expectations in order for the company to have a positive outlook, in my opinion.

Therefore, even if we see a big jump tomorrow, if the earnings report is good or better than expected, and we see this jump in price, I think we will see a pullback. We saw this in the last earnings report ; this jump here, then the price fell for a long period.

So, what I did was create a small graph, and I'm going to show it now. This chart is for MU stock. We should call him... Yes, sir. As you can see, I work on Google Sheets. These are the profits of MU company .

I extracted some prices, and they go back to 2022. I didn't want to go too deep because the market changes over time. So, we are looking at future projections, or rather, we are looking at the third quarter of 2026.

The earnings announcement date was June 24th. I wanted to know the stock price before the earnings announcement, because this is its price today. This is its price one day before the earnings announcement.

If we look at the stock price before the earnings announcement in the last quarter, it was 1048. Then I wanted to look at the stock price after 51 days. I specifically chose 51 days because they represent the contracts for the month of November.

This chart is for MU stock.

Let's review the MU data here. We will open the MU page. We will move on to the options series. We have an earnings announcement tomorrow, as shown. Then on November 20, that is, after 52 or 51 days.

We will choose both options. Both are winners. Let's look at both of them here. If we want to calculate the expected movement, we will look at what the expected movement is from here?

It's 1070. So, we'll add up the price of both. We will add the value of purchasing the strangle option. Let's call this 190. Then we divide the result by 190 × 0.8 . Where is the calculator?

I will perform this calculation for you. We will do it together. So that you can see what we see. You can use 0.75 if you want, but 0.8 is the common price . So, 190. Do you understand where I got these calculations from?

Buying a double call option (Long Straddle), the purchase price of the call option and the purchase price of the put option. Currently, the value of the call option is slightly higher, so there is a slight bias towards an upward price for the option based on today's prices.

The stock is trading at 1072. Therefore, 190 x 0.8. This will give us a rough idea of the expected movement between now and

I have a deal in progress right now, and it's quite large, which is one of the reasons I'm interested in it. But, if we look at this series, let's wipe it clean completely, and we'll look at the November 20 data , and I have a very bold deal.

I sold at 1100 and bought at 1350. So, we will see here that this trade now, if we look at the simulator , has a maximum loss of $837 and a maximum profit of $6000. The probability of profit is 66.74%, which means it falls within my expectations of profit or loss.

Now, the expected movement now, based on that, is 150 points. Okay, let's go back to the calculator again. We have 152 plus the current share price. So, we'll assume the price is 1072.

This trade started a short time ago , so it doesn't depend on today's entry price. After 10 minutes, the price will be 1072 plus 150, which is the expected price based on our calculations.

Now, the expected price is 1222. As you can see, the breakeven point is 1162. If we move to 1222 , the profit and loss value of this trade will be $6000. That's what I'm betting on .

I believe that if we reach the upper limit of the expected price, the risk-to- reward ratio will be equal based on the amount I have raised. I have a maximum profit of $6,000 and a maximum risk greater than $18,000 , but the expected return is a loss of about $6,000.

This transaction is risk-free , and this was done intentionally. I already have some long positions in my portfolio, so the main objective is to determine the direction of market movement.

What I wanted to know , and that's why I created this little chart, is how likely these moves are to repeat. To be honest, it's a bit worrying . It would have been better if I had done this analysis before starting this deal.

But I am doing it this morning while I am still in the deal, and I have not closed it yet , which means that I have decided to continue with it. These green-shaded positions indicate times when the market, 52 days after the day before earnings, was trading below the 7.19% level.

This is the market level. This is the 7.9% level, because that's the breakeven point for me, and this is the 141 or 1141 level. So, what I wanted to know is: how often does this happen?

It is important to recognize that we have witnessed enormous price movements. For example, we saw highs of 14, 16, 33 , 59, 71. The stock price rose from $100 to $1065. The stock has made a significant rise.

I think that after this big rise, we saw a jump the day after the latest earnings announcement, and then a decline. I expect to see a similar price movement. The height may not be large , it may be slight.

After the significant rise we witnessed in the third quarter, we experienced a 20% decline, followed by a 23% decline in the fourth quarter of 2024. We achieved a positive return, but it was still below the expected rise at the breakeven point, which is 7.19.

This is what I have concluded. Well, now, if the price goes up crazy and we see another 70% increase, I ca n't imagine that happening . That's why I put a stop to the loss. I don't want to take such a big risk that I could lose $50,000 if the market crashes completely.

This is not a wise course of action . Therefore, I rarely trade short positions. I often set a risk level, but the idea here is that I expect the market to move less than 7% based on what I see from the charts and other sources.

I do not expect, for any reason whatsoever, that Micron's stock price will fall below $800. They make huge profits regardless, and their price may never drop . It may rise gradually, but my overall outlook for this stock is short.