BKNG – Post Trade Analysis – Booking Holdings Inc.

Ever wondered how to spot a winning trade even when a stock is crashing? Most traders panic during a selloff, but we saw an opportunity. In just 21 days, our system delivered a 17.9% gain in BKNG. Read on to see exactly how our QUANTAMENTAL scoring algorithm pinpointed this high-probability setup—so you can catch the next big move before it happens!.

Company Overview: Booking Holdings Inc. (NASDAQ: BKNG)

Booking Holdings Inc. is a global leader in online travel and related services, operating well-known platforms such as Booking.com, Priceline, Agoda, Kayak, and OpenTable. The company thrives on its ability to generate revenue through travel bookings, accommodation reservations, and related services, making it a key player in the global travel industry. Even in uncertain market conditions, BKNG has demonstrated strong profitability and resilience, making it a prime candidate for high-quality trade opportunities.

The Setup: Spotting the Opportunity

The broader market had been riding high, hitting a fresh 52-week peak on July 10th, 2024. However, what followed was a swift and sharp 10% correction that lasted for several weeks, bottoming out on August 5th.

BKNG moved in lockstep with this trend, reaching its own 52-week high peaking on July 16th before plummeting 24% over the next two weeks. The selloff culminated on August 5th, right in sync with the market’s broader downturn. This general market weakness undoubtedly played a role in exacerbating the decline, creating a more pronounced move than BKNG’s fundamentals alone would have justified.

From a technical standpoint, BKNG’s RSI had plunged below 30, indicating that the stock was in oversold territory. This was enough to land it squarely on our watchlist. More importantly, our proprietary QUANTAMENTAL scoring algorithm kicked in, assigning BKNG a perfect 15 out of 15 score—a rare event historically associated with some of our highest-probability trades.

Executing the Trade: Entry & Exit

On August 5th, BKNG suffered yet another gap down, briefly touching its yearly low before staging a sharp reversal. This price action created a large bullish reversal candle, and by the next day, RSI had crossed back above 30, triggering our entry signal. With confirmation in place, we took our position on August 8th.

What followed was a steady and sustained move upward. The stock quickly reclaimed its 5-day moving average and remained above it for the next 23 days, demonstrating clear momentum in our favor. Finally, on August 28th, BKNG hit our price target, and we exited the trade, locking in a 17.9% gain in just 21 days—a staggering 312% annualized return.

This trade was a textbook example of how our system identifies low-risk, high-reward setups that deliver fast, profitable returns.

QUANTAMENTAL Scoring Review

Each week, we break down a portion of our proprietary QUANTAMENTAL scoring algorithm, which evaluates stocks based on a blend of technical and fundamental factors. Today, we’re giving you a look into two key parts of our system: Technical Analysis and Earnings Revision Analysis—both of which played a major role in our BKNG trade.

Technical Screening System

We are looking for stocks in a well-established near and long term uptrends that have stumbled. BKNG fit our technical criteria perfectly:

• Strong Trend Structure: The 50DMA consistently runs above the 200DMA (1 point), and the 100DMA remains above the 200DMA (1 point).

• Positive Momentum: The stock maintains a positive return Year Over Year (1 point).

• RSI Cross Over Signal: When BKNG sold off sharply, it triggered our RSI Cross Over signal (1 point), which occurs when the stock's Relative Strength Index (RSI) drops below 30, signaling extreme oversold conditions. Historically, this has been a strong indicator of a potential reversal, and BKNG’s historical reaction to this setup has been highly favorable based on our RSI Back Test (1 point)

Looking at the chart, it’s clear that buying near the 200DMA has historically been a strong opportunity for BKNG.

This technical confirmation was a key reason why BKNG was a prime trade opportunity—and why it delivered a 17.9% gain in just 21 days.

Earnings Revision Analysis

One of the most powerful drivers of stock price movements is earnings revisions—when analysts raise their future earnings estimates based on strong financial performance.

For BKNG, we analyzed the earnings estimates for 2024 and saw a clear pattern of upward revisions over the past few months. This was another strong confirmation that BKNG was set up for a high-probability, high-reward trade—which ultimately delivered in just three weeks.

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Post-Trade Reflections: What This Trade Taught Us

This trade underscored an important lesson: overreactions often create opportunity. While the initial selloff may have seemed justified on the surface, a closer look revealed that it was driven more by short-term sentiment than by fundamental weakness.

During the decline, several notable events took place. The day the selloff began, news broke that BKNG’s CEO had sold $3 million worth of stock during the recent run-up. While insider selling can sometimes raise red flags, it’s not always a reason to panic—especially when institutions remain bullish. Interestingly, Oppenheimer and Morgan Stanley raised their price targets for BKNG even as the stock tumbled, signaling that they viewed the decline as temporary. Then came earnings on August 1st. The company delivered a solid beat on expectations, but softer-than-expected guidance spooked investors further. Post-report, several firms lowered their price targets but maintained Outperform ratings, reinforcing that the long-term outlook remained strong despite short-term concerns.

Additionally, the general market weakness played a significant role in amplifying BKNG’s decline. With the broader indices undergoing a sharp correction, stocks across the board faced downward pressure, and BKNG was no exception. When combined with earnings uncertainty and insider selling, the result was an exaggerated move to the downside—one that our algorithm identified as an overreaction and a prime buying opportunity.

When combined, these factors created an exaggerated downside move—one that our algorithm correctly identified as an overreaction. By sticking to data-driven signals instead of emotions, we were able to capitalize on the bounce for a 17.9% gain.

We’ve seen this pattern play out time and time again: fundamentally strong stocks selling off ahead of earnings, only to rebound when panic subsides. It’s a setup we continue to study, and one that has yielded strong results for us historically.

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Disclaimer

This post is not financial advice. The stock market is risky, and any trade or investment is expected to have some, or total, loss. Please do your own research before making any trades. Do not use this information for investment decisions.