EA · Electronic Arts Inc. — research history

For zero-revenue resource companies, earnings reports are operational milestone updates, not financial performance events. Market reaction is typically delayed 3-7 days as analysts digest operational details (mine start-up, production targets, inventory decisions). Use longer-dated options (7-14 DTE) or calendar spreads instead of tight DTE spreads that expire before the full reaction.

Applies when: Applies to all pre-revenue or zero-revenue resource/mining companies where operational milestones (mine start-up, production ramp, permitting) drive valuations. Does NOT apply to established producers with consistent revenue where earnings reactions are immediate.

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In low-float, high-short-interest commodity names (~10%+ shorts), pre-earnings positioning can cause large directional spikes (10-15%) that distort entry pricing and skew readings. These spikes are driven by gamma positioning and short-covering, not fundamental information. Enter spreads AFTER the pre-event spike resolves, not before.

Applies when: Applies to commodity-linked names with short interest >10% and market cap <$10B entering earnings. Does NOT apply to large-cap names with low short interest where positioning is more efficient.

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When directional thesis is correct but the move occurs after option expiry, the trade is a technical win but a strategic loss. The capital is locked up during the delayed reaction period, and theta decay continues. For binary operational events, consider selling the put spread leg to finance a longer-dated call/put if the directional conviction is high but timing is uncertain.

Applies when: Applies to all event-driven option trades where the catalyst is an operational milestone rather than a financial metric. Does NOT apply to pure financial catalysts (Fed decisions, regulatory approvals) where reactions are typically immediate.

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In commodity-linked names with institutional holders, put skew is often driven by hedging activity (portfolio insurance, commodity price exposure) rather than directional bearishness. Elevated put skew in these names should be discounted as a signal and treated as structural, not informational.

Applies when: Applies to all commodity-linked names (uranium, copper, lithium, oil) where institutional holders hedge commodity price exposure via options. Does NOT apply to pure-play companies with no commodity exposure where skew reflects genuine directional views.

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For pre-revenue mining companies, the key earnings catalyst is operational progress (mine start-up, production targets, permitting status), not EPS. EPS misses are expected and priced in. Market reaction is driven by whether operational milestones are met or delayed, not financial performance. Score catalysts based on operational milestone significance, not EPS surprise potential.

Applies when: Applies to all pre-revenue or early-stage mining/exploration companies. Does NOT apply to established producers where EPS and revenue are the primary drivers.

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When RSI(14) > 80 AND the stock has run up >40% in 180 days entering earnings, the probability of mean-reversion is high regardless of implied move richness. The direction_evidence score should be reduced by at least 5 points, and the trade should be avoided unless there is a strong contrarian catalyst.

Applies when: Applies to any earnings play where RSI > 80 and the stock has run up >40% in the prior 180 days. Does NOT apply when the stock is near its 200-DMA or has been consolidating.

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If the options chain has null bid/ask data across all strikes, the implied move calculation is unreliable. The scout should flag this as a fatal flaw and reject the trade — do not proceed with assumed implied move metrics.

Applies when: Applies to any options-based trade where the implied move is a key input. Does NOT apply to trades that do not rely on implied move calculations.

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In cybersecurity names during AI-capex peaks, executive sales (even Rule 10b5-1) at prices significantly below current spot should be weighted more heavily than analyst upgrades. Insiders are closer to the data and may be positioning for a plateau.

Applies when: Applies to cybersecurity and AI-infrastructure names during periods of elevated analyst optimism. Does NOT apply when insiders are buying or when sales are at prices near current spot.

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Historical EPS beats do not guarantee positive stock reaction if the stock has already run up into the event. The 'beat' is priced in, and any 'in-line' result is a disappointment. The catalyst_was_real score should be reduced when the pre-event run-up exceeds 20%.

Applies when: Applies to any earnings play where the stock has run up >20% into the event. Does NOT apply when the stock has been consolidating or declining into the event.

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RSI(14) > 80 is a valid overbought signal that should reduce the technical_was_useful score and trigger a mean-reversion warning. In the scoring methodology, technical signals should not be dismissed as 'Tier 3 confirmation' when they indicate extreme conditions.

Applies when: Applies to any trade where RSI > 80 or < 20. Does NOT apply in strong trending regimes where RSI can remain extended.

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