Catch some air with Ares Management ($ARES) – February 19, 2025
Dan Fitzpatrick here at StockMarketMentor.com. I want to talk about Ares Management ( NYSE: ARES ).
We caught this stock several months ago on this volatility squeeze breakout. This is not that. However, this is looking pretty good to me. You can see how it’s rebounding right around the 50-day moving average. They’ve already reported earnings back here. The stock is above the price it was on that earnings day, and that’s important.
That’s a really important thing to know. Also, another important thing is that earnings were actually down, versus the same quarter the prior year. The company earned 72 cents a day, versus 86 cents the prior year. Why am I saying that? Because this is a very, very important aspect of trading.
When you can look at a stock, listen to me, I’m giving you pearls here, when you can look at a stock and say, oh, bad news on earnings, why is the stock up? That tells you that the market has already largely factored in the poor earnings. Or it has done so after the fact pretty quickly, and that’s really what happened here.
The earnings were released on the 5th of February, that’s right here. The stock gaps down runs back up, and holds for a few days. Then what does it do? It comes back to test, not just the 50-day moving average but this gap. This level of support that was established on this day was tested again, first on this day and a higher close, relative to the low.
And then on this day, just a static thing, and then on this day a higher close relative to the open. So this gave you a little whoop-de-do. Then today, a big move higher in volume. This shows post-market, if we just go to regular hours though, boom, we get a difference. And so, wait a minute, what happened there? I don’t get that.
So you look at the 1-minute chart. It’s like a stupid tick or something like that. I see that, and then I completely disregard it and say that I don’t give a crap about this, I just want to look at regular hours. They didn’t report earnings, nothing like that. So what do I see? By the way, always check that, always make sure that you know what you’re looking at.
I look at this and I see a hammer pattern here, where the stock comes down. It forms a low here, and then it comes back up, that’s called chewing its tail. This is the handle, right here, and then here’s the hammer. So I think your trade on this would be, the high of the day is 187.75.
If the stock runs up above this intraday high, (I’m going to set an alert for myself) if it does that tomorrow, note that it’s back up above the 8-day EMA and it’s printing a new high, this is continuing. The prior day was 189.25, right around there. So this would be another area where you’d set an alert because this now runs above this last high.
So we’ve got two, a very, very short-term intraday trading alert, bam, I’m in. And then another one that’s a little bit longer where it gets above this one. You might set those two alerts, and see if you can make some money. And then definitely keep your stop a little bit below today’s intraday low. If it falls back below today’s intraday low, then you’re wrong on the rebound here. It’s still going to take a little bit more work, and it’s a very, very low-risk trade that way.
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