Hey traders, it’s Matt here.
Yesterday, Bryce put together a GREAT blog post about the hottest sector in the market right now. He even included a watchlist full of the best setups!
I’m sending out a new blog post TODAY to focus on a very specific aspect of these runners.
Some stocks can spike better than others.
And when the market opens on Monday at 9:30 A.M. Eastern, we want to focus on the best trade setups.
Don’t waste time with crappy runners …
- You might end up taking a loss.
- You might miss the better setup.
This #1 spike factor isn’t a big market secret. It’s just overlooked because most traders let greed drive their positions.
Slow down a little and focus on the #1 factor that makes a strong spiker:
Low Float Runners
Bryce included a great list of oil & gas runners yesterday. But within that sector we could see multiple runners on Monday.
How will we know which stock to trade?
Focus on stocks with a float that’s close to or below 10 million shares.
The low supply of shares helps prices spike higher when demand increases.
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This goes for all stocks, not just oil & gas runners.
For example, last Friday when we saw the oil & gas sector surge, we also saw PaxMedica Inc. (NASDAQ: PXMD) spike 190%. It was after the company announced updates on a possible new drug application (NDA) to the U.S. FDA.
It’s not in the oil & gas sector, but it announced a hot catalyst related to the FDA. And StocksToTrade shows that the float is only 7.1 million shares. The low supply helped prices spike higher.
The chart below shows the spike, every candle represents 3 minutes:
PXMD chart multi-day, 3-minute candles Source: StocksToTrade
By the way: Keep an eye on this stock Monday as it consolidates sideways.
Go through Bryce’s watchlist from yesterday, there are two oil & gas stocks with a float below 10 million shares. Those are the top plays to watch.
And get ready for Monday’s first-day spikers that have a low float.
- We don’t know which stocks will spike on Monday. But we DO know how to find the right runners once they start to move.
Looking for the best news pushing stocks higher: This is where I wait for Breaking News alerts on the biggest spikes.
And if the alert shows a low float … It’s game time!
Cheers,
Matt Monaco