Investigating the Prediction Power of the Information Content of the Earnings Announcement by Technical Analysis

In recent years, studies have been conducted about the performance of some analytical methods to detect the abnormal return on the earnings announcement date. Two of the most important approaches that always are bold in the intellectual literature of capital market are technical and fundamental analysis. The purpose of this research is investigating the prediction power of the information content of the earnings announcement by technical analysis signals in Tehran Stock Exchange. Type of Technical strategy used is simple moving average with volume confirmation. The results indicate that during the period 1390-1394, Technical analysis strategy able to predict information content of earnings announcement, because this strategy could produce abnormal return and positive adjusted return before earnings announcements date.