 Okay folks, welcome to some post earnings analysis of PayPal, ticker symbol PYPL. What you're looking at here is a five-minute chart. Normally I wouldn't use a five-minute chart, but we're talking about after-hours price action here. What we'll talk about in more detail and to put some structure around this commentary is we're going to first talk about the earnings. Then we're going to talk about guidance, then valuation, and then we're going to talk about some technical analysis of PayPal. How does it look on a higher level view on the charts, meaning from perhaps a monthly timeframe to at least a weekly timeframe down to a daily timeframe? And I'll give you my thoughts of as to where I believe the shares are headed in the short term and stick around to the end of this commentary and I do have a surprise for you with regard to my interest in these shares. So that's what you call a tease in YouTube land. So let's get started. After our session here, we're obviously down off the highs of the day. The New York reaction, as is typical with earnings or any event, is usually the wrong knee jerk reaction. We initially rallied and then we sold off hard. Let's get to the news. Let's get things off first with the headlines. PayPal earnings top views, but stock falls on lack of 2021 guidance. With regard to earnings, PayPal earnings rose 41% to an adjusted $1.07 per share, the company said. PayPal revenue climbed 25% to $5.46 billion, including the acquisition of Honey. I was unaware of that. They blew away analysts expectations, which were at 94 cents per share. So they beat on earnings by a mile and they beat by a respectable margin on revenues. Now, relative to the year ago quarter, PayPal earned 61 cents per share on sales of $4.38 billion. The stock is a monster. Now here's what caused the after hours hiccup. PayPal earnings report since shares down in extended hours trading on Monday, as the company did not provide preliminary guidance for fiscal 2021. I'll give you my thoughts on that in a moment. Now, when you take a look at the quality of this company in terms of industry dominance, they are ranked at number one by IBD in the finance credit card payment processing group. Their composite rating, which is measured by IBD, combines all five smart select ratings that's proprietary IBD into one easy to use rating. A 90 rating means that the stock is outperformed at 90% of all other stocks in terms of its combined smart select ratings. In short, it's top tier relative to all other stocks. EPS rating 95, close to top tier, relative strength rating above 90, outperforming 91% of other stocks. Now it is under some distribution with a D plus rating. And when you take a look at their annual ROE, this shows you the quality of their management. They have an ROE of 21.8%, huge. So I consider PayPal a position that you'd want to put on for the longer term after we get a shakeout here in the short term. Now, why do I believe there will be a shakeout moving forward? Well, if you take a look at the PE ratio, this is not adjusted for today's earnings. We're at near 80 on PE relative to that of 35, spot 25 on Microsoft. Now granted, PayPal has faster growing earnings and revenue growth, but it's not more than double than that of Microsoft. And when you take a look at the price on a price to sales basis, the good news here is that it's actually below that of Microsoft. But still, it's extended. So while I'm sure that we're going to see higher highs in the future for PayPal in the short term, there's plenty of room to back and fill here as we see profit taking as we begin to see market weakness in the coming weeks. But I'm a big believer that as this election ends, you're going to see this economy open up far faster than anyone ever expected it to. And when we do so, you're going to see PayPal be able to provide more visibility and that will be the proximate cause of as to why assuming that visibility is strong. That'll be the proximate cause of as to why the shares will continue to ramp up higher. So I'm optimistic about the company moving forward. They're moving in the right directions in terms of their exposure now to cryptocurrencies, the move towards digital currencies. So by far the industry leader, let's take a look at the technicals to identify where we may be going from here. Now, taking a look at the monthly chart of PayPal to give us that higher level view of where the shares have been to identify where they might be going. You could see that after a huge rally higher, which began back in April, and where we peaked out ultimately with a high in October, when we flashed a bearish reversal, we've had a heck of a run we would do for a pause. And where we found lows after hours this evening, we're at lows of where we opened back in July at around 174 19 we actually undercut 174 19 by a few pennies this evening, then we bounced. So I think that what we may do is we may hold this support level at least short term weekly chart. Now the weekly chart is not reflective of the after hours price action. So keep that in mind. I'll highlight where we are trading at current right in this neighborhood as highlighted in green here. So what I want to do is I want to create an alert. What I'm using here is trend spider. If you're not familiar with trend spider, they are the leader in automated technical analysis. If you are new to trading stocks and you're learning technical analysis, I'll show you a trick in a moment that you'll appreciate as you hone your craft at drawing support and resistance levels. Okay, so I have an alert set. I want to know if we break through touch or bounce. I'll be alerted on a confirmation one hour candlestick. This note notifies me that there was July support, which we saw yet again act to support back in September. And this note here should give you a clue as to my surprise at the end of this video. Potential add to long trade. So let's drill down to a daily chart. Again, this is not reflective of the after hours price action. Right down here is where we're at at current. I want to make a bold statement here, folks. I think that we close up tomorrow being Tuesday. And why do I believe that? I believe that because oil told me that. That's right. And let me share with you why. Last night, being Sunday evening, the futures market opened up. I was live with about 60, 70 people joining us on the live stream, watching the futures markets open up. And when I pulled up a chart of oil, oil was crashing. We were down at the lows more than 5%. And stocks began to weaken. Now, keep in mind that the market is obviously been under some pressure. We have just Monday and Tuesday to really goose this market for everyone with 401ks to feel good going into the polling booth. So there was no way. And I mentioned this last night, there was no way that stocks were going to rally with crude prices crashing. And I made a statement. You can go check it out. It's posted on YouTube. I said, get prepared to wake up tomorrow morning and the Federal Reserve will be the owner of brand new crude futures contracts. And the stock market will probably reverse. Sure enough, we were woke this morning. Oil was well off the lows of the session. And the stock market futures were up dramatically. What do I think is going to happen as you proceed into election day? More shenanigans, more chicanery. This is a fake market, folks. And that's okay. That's okay. As long as we're aware of it, we're going to make profits. We're going to make money on it. Now, the surprise that I have for you is that after hours this evening, going to the chart of PayPal after hours, knowing that we had monthly support going back to July and then again, retested in September, right below where we bounced this evening. I bought some shares, not a whole bunch speculative, but I did send out an alert to members notifying them after hours that we did open up a new position in PayPal, because I do believe they are going to rally it tomorrow assuming that they rally the market as well, which I believe that they will, given that it is election day and the president, Jay Powell and Steve Mnuchin certainly have the power to manipulate the markets for another 24 hours. And folks, I would ask you to please join us on Sunday and Thursday evenings live on Sunday nights. We review the opening price action of the futures markets, because that's truly when the trading week begins, not on Monday morning, but on Sunday nights. And then on Thursdays, 6pm Eastern Standard Time, we get together again and then we review the weekly charts and we discuss how the charts on the week appear to be closing out. And then I take some chart requests from both members in the audience. And if you'd like to see my commentary from last night to live stream, it should be right in front of you right now. Also, I have a tutorial on RSI strategies that should be there as well for you. Everybody have a profitable trading day, get out and vote, stay healthy and be well.