To The Moon

Storage is one of the hottest AI infrastructure trades right now, and this earnings week is mainly about Seagate (STX) and Western Digital (WDC). Both names have been on massive runs into the prints, so the key risk is not “good vs bad earnings”, but good vs already-priced-in.

1) Know the setup (why it's dangerous)

STX and WDC have rallied hard recently. That typically creates a “crowded long” situation where:

A small miss or cautious tone can dump the stock hard

Even a beat can sell off if guidance is not a clear raise

The real move often happens on the call + guidance, not the headline numbers

STX reports Jan 27, WDC reports later this week (widely tracked as Thursday).

2) The main drivers to watch (what actually moves price)

For storage, the market is pricing a story of AI-driven data center demand + supply tightness + improving margins. What you want to see:

Strong data center revenue contribution / enterprise demand

Any confirmation that supply stays constrained into 2026 and beyond

Gross margin trend holding up (or improving)

This is consistent with recent commentary that demand > supply, and that the market remains supply constrained.

3) Best “moves” this week (risk-controlled)

Move A: Don’t YOLO earnings, trade the reaction

Most consistent play: wait for earnings, then trade the next day. What to do:

If the stock gaps up and holds the first hour: trend-follow long (small size)

If it gaps up then fades: short-term mean reversion short (tight risk)

If it gaps down but recovers VWAP: rebound long setup

This avoids getting wrecked by overnight volatility.

Move B: If you must hold through earnings, cap downside

Best practice: use defined risk. Examples: $Palantir Technologies Inc.(PLTR)$  

Buy shares + buy a put (protective put)

Buy a call spread (capped gain, limited loss)

Avoid naked short options unless you are experienced

Reason: these names can swing violently post-earnings.

Move C: Reduce “pre-earnings greed”

If you already rode the run-up:

Take partial profit before earnings

Keep a smaller runner position This is how you avoid turning a winner into a disaster.

4) What would make me bullish vs bearish after earnings

Bullish if:$Tesla Motors(TSLA)$  

Clear guidance raise

Strong data center narrative

Margins expanding and pricing power intact

Bearish if: $SPDR S&P 500 ETF Trust(SPY)$  

“Good quarter but cautious next quarter”

Any hint supply is loosening faster than expected

Capex / pricing suggests competition heats up

Bottom line $SPDR Gold ETF(GLD)$  

This week is more about execution and risk management than predicting EPS. The highest-quality trade is usually post-earnings reaction (confirmation) instead of pre-earnings gambling. STX Tuesday, WDC later this week: plan your sizing, define your max loss, and be ready to act on the call-driven move.