A week of uncertainty in the banking stocks finished off with more bad news on Friday… 

This came after headlines went back and forth all week from the perceived positive news that the government would insure depositors in SVB Financial Group (NASDAQ: SIVB)…

To the negative headlines of the potential failure of Credit Suisse Group AG (NYSE: CS).

We received good news that JPMorgan Chase & Co. (NYSE: JPM), Bank of America Corporation (NYSE: BAC), Morgan Stanley (NYSE: MS), and more were depositing a combined $30 billion into First Republic Bank (NYSE: FRC) to help shore it up against potential failure on Thursday.  

However, things started to turn sour again on Friday. The $30 billion cash injection failed to impress traders. 

This is why I said to avoid these “newsy” stocks and the sector as potential dip buys or shorts last week… 

They were in play and volatile … But there were too many risks…

Headlines can change from day to day and minute to minute as I just explained. 

And instead of playing guessing games and being at the mercy of news reports and politicians — you could’ve traded another sector that was in an uptrend all week… 

Get all the details of Millionaire Trader Matt Monaco’s NEW secret project here! 

A Crucial Skill To Work On Today 

If you were looking to dip-buy bank stocks and swing them for a profit — there were better opportunities out there for that strategy… 

Tech stocks rallied last week… 

Big names like Alphabet Inc. (NASDAQ: GOOGL), Microsoft Corporation (NASDAQ: MSFT), NVIDIA Corporation (NASDAQ: NVDA), and Advanced Micro Devices, Inc. (NASDAQ: AMD) all had nice moves over the last five days. 

Check out the charts…

Now compare those to the five-day charts of some of the beaten-down bank charts…

What do you notice?

First, I see four tech stock charts that are all in an uptrend… 

Then I see three charts of beaten-down stocks that have no clear direction. 

So if you want to take advantage of upside moves by taking a long position, which stocks do you think would offer better trade opportunities? 

The stocks that are in an uptrend… 

These are stocks that make higher highs and higher lows and are generally moving higher. 

As opposed to stocks that are in a downtrend — making lower highs and lower lows. Or choppy stocks that have no clear direction, they just have random up and down movements. 

This is a crucial lesson for new traders… 

You must know how to recognize trends. 

It doesn’t matter if you trade large-cap stocks or penny stocks… 

When you take a long position, you want the stock to go up to your goals so you can take your gains. 

But if you waste time and money in choppy stocks with no direction, you’ll end up with a bunch of paper-cut losses and frustration. 

Read this past Daily Accelerator issue to learn more about trends. 

And consider reading some of my favorite books on trend following and chart analysis… 

• “Technical Analysis Using Multiple Timeframes” by Brian Shannon.
• “A Complete Guide To Volume Price Analysis” by Anna Coulling.
• “Trend Following, 5th Edition: How to Make a Fortune in Bull, Bear and Black Swan Markets” by Michael W. Covel.

Cutting out random trades that result in losses can be one of the best things you do to get on the path to becoming the trader you want to be. 

That can start with focusing on stocks that are in a trend. 

Get an exclusive weekly watchlist from me as part of your StocksToTrade Advisory subscription. 

I’ll share what I’m watching, the key levels to help you make trade plans, and what I see in the overall market to help you make better trading decisions. 

Have a great Money Monday, everyone. See you back here tomorrow. 

Tim Bohen

Lead Trainer, StocksToTrade

I just saw something yesterday that got me excited… 

It’s a stock that checks a lot of boxes. 

And I handed out the trade plan you could’ve used on Wednesday morning… 

But yesterday the stock mostly consolidated. 

That plays perfectly into the pattern I’m looking for next… 

Why am I excited about a stock that consolidated? And which pattern am I watching for today? 

Read on to find out…

Are You Excited About This? 

ThermoGenesis Holdings, Inc. (NASDAQ: THMO) played out my Daily Market Profit plan after hours on Wednesday and in premarket yesterday. Get my alerts and trade plans emailed to you daily here. 

But after the stock hit my target price — news of an offering hit and the stock dropped from about $6.75 down to $4. 

So why am I excited? 

Well, even with bad news THMO was able to bounce back and climb from a low of $4 in premarket to a high of $6.23 yesterday.

Stocks don’t always bounce back after an offering but even with an offering of shares and warrants — THMO still has a low float. 

It had a float of under one million on Wednesday. But even adding the shares from the offering and warrants, the stock still has a float of around only three million. 

So it checks a lot of the boxes we look for: 

• It has positive news from Wednesday. 
• It’s a low-float stock.
• It’s a big percent gainer. 

And above all, it has what I said to look for yesterday…

THMO is now a multi-day runner — a stock that hangs around. 

It might be down a lot from yesterday’s premarket highs of $7.75…

But it’s still up roughly 150% over the last two days.

2-day, 2-minute candle — courtesy of StocksToTrade.com

So I’m looking for a potential day-three surge-type pattern today. Set an alert near the breakout level…

I’ll be watching the same level I sent out in my Daily Market Profit alert yesterday as a potential entry. 

If you missed out on my trade plan — get my next one here! 

I send one out every morning in the premarket. Plus, I go live to give traders my top afternoon watch every day at noon. 

See you there! 

Have a great day everyone. See you back here tomorrow. 

Tim Bohen

Lead Trainer, StocksToTrade

The DOW was down over 700 points yesterday morning, as the market was rattled yet again by fears of another potential bank collapse… 

Credit Suisse Group AG (NYSE: CS) opened almost 30% lower as bank stress concerns spread and after the bank’s biggest investor said it couldn’t support the stock any longer due to regulatory restraints. 

All the premarket news and price action looked like we were poised for a wild ride of volatility… 

How did the doom and gloom picture play out in penny stock land?

Believe it or not…it was actually pretty slow. And I’ll explain why shortly. 

If you’re in the SteadyTrade Team, you know I find Wednesday to be the slowest trading day of the week… 

Experience will show you when you should push trades and when you should back off. And yesterday wasn’t what I would call a frothy day… 

So what do I want to see happen in penny stocks for me to get excited?

Here are a few criteria and examples of what I’m looking for… 

3 Things I Want To See To Get Excited

It doesn’t necessarily matter what the macro news headlines are, or what the overall markets are doing for there to be big penny stock movers. 

These stocks trade in their own little world… 

But traders need something to get excited about for them to jump into a stock and create the massive moves we like to take advantage of. 

We need emotion — excitement, greed, and FOMO. 

To generate that, most day traders like to see the same things… 

A Hot Sector 

Right now, SPACs are still hot. Ambipar Emergency Response (AMEX: AMBI) was one of them on Tuesday… 

It was a giant squeezer with no news. 

AMBI chart: 2-day, 2-minute candle — courtesy of StocksToTrade.com

But it couldn’t hold its gains yesterday. 

So although we kinda have a hot sector right now, a stock still has to check a lot of the boxes to be a trade. And having news is one of those boxes. 

What I’d like to see to heat the entire sector up, is for one of these stocks to have news and a big spike… 

That should make short sellers nervous in any of the SPAC stocks since they can move together.

A Big Gainer 

A big percent gainer is one of the criteria we also look for in potential stocks to trade. 

Yesterday ThermoGenesis Holdings, Inc. (NASDAQ: THMO) spiked as much as 158% in premarket after it announced it’s rolling out a new facility. 

The Breaking News Chat team alerted the news. But a few minutes after the open, they also alerted that the stock was a chat pump. 

And like chat pumps usually do — it failed at the open. 

When a stock becomes a chat pump, I like to wait until 9:45 a.m. or later to enter a trade. And that rule would’ve kept you safe in THMO yesterday…

THMO chart: 1-day, 2-minute candle — courtesy of StocksToTrade.com

But you don’t have to be first to trade any big gainer or hot sector stock… 

Remember some of the best plays lately have been on day two, three, or four… 

So that brings me to another criterion I like to see… 

“Hanging Around” 

Both of the stock examples above had some of the things I look for in a stock — but not all of them. 

And neither of them “hung around.” 

Meaning, they didn’t hold near their highs…

And since some of the best runners I’ve seen lately are multi-day runners — they don’t have me too excited. 

So until I see a big gainer with news, preferably in a hot sector with high volume that can hold its highs… 

I won’t be over-aggressive in my trade plans. 

And remember what’s working in the market right now and what isn’t — I give you all the details in my weekly Market Update videos here. 

Have a great day everyone. See you back here tomorrow. 

Tim Bohen

Lead Trainer, StocksToTrade

The mainstream media is pushing a bunch of doom and gloom after the collapse of SVB Financial Group (NASDAQ: SIVB) and Signature Bank (NASDAQ: SBNY). 

When Monday’s opening bell rang…they wanted you to believe the world was ending…

But the market is still here. And many banking stocks are bouncing from their lows. 

The crazy thing is it had almost ZERO IMPACT on penny stocks. 

And that’s the beauty of penny stocks, they are like an uncorrelated asset class. 

In fact, if you’re a penny stock trader, the last week has been business as usual… 

You have two options, buy into the fear that the overall market is doomed. Or trade an asset class that is providing traders with bountiful opportunities daily. 

Here’s what’s on my radar…

Penny Stocks To Watch

Ainos, Inc. (NASDAQ: AIMD) was the most liquid low-float stock on Oracle yesterday. It became my number one watch but we didn’t get the follow-through to the high $1 like I was hoping. 

But it was day one … And we know those haven’t been the best plays right now. The stock chopped around VWAP for most of the day but it’s still up roughly 70%. 

Today it’s a watch for breaks above yesterday’s high. 

AIMD chart: 1-day, 2-minute candle — courtesy of StocksToTrade.com

Crypto stocks Marathon Digital Holdings, Inc. (NASDAQ: MARA) and Riot Platforms, Inc. (NASDAQ: RIOT) have been in play this week with bitcoin bouncing. 

Traders think crypto could be considered a safe haven from the negative banking headlines. There could also be increased confidence with the bailout announcement for depositors in SVB and Signature banks. 

MARA chart: 3-day, 2-minute candle — courtesy of StocksToTrade.com

RIOT chart: 3-day, 2-minute candle — courtesy of StocksToTrade.com

Ambipar Emergency Response (AMEX: AMBI) is a SPAC that spiked over 250% yesterday. 

SPACs have been hot as we’ve seen with the runs in Intuitive Machines, Inc. (NASDAQ: LUNR), Ocean Biomedical, Inc. (NASDAQ: OCEA), and EUDA Health Holdings Limited (NASDAQ: EUDA) recently. 

AMBI could be the number-one watch today if we get news or it regains key levels in premarket.  

AMBI chart: 1-day, 2-minute candle — courtesy of StocksToTrade.com

As you can see there are still a ton of potential plays in penny stocks. Stick to your process and patterns and tune out the noise from the overall market. 

If you want more of my watchlists, game plans, and market insights — join StocksToTrade Advisory. 

Have a great day everyone. See you back here tomorrow. 

Tim Bohen

Lead Trainer, StocksToTrade

The biggest temptation for traders this week will be trying to capitalize on the volatility in bank stocks… 

All the bank stocks were battered yesterday after news of SVB Financial Group’s (NASDAQ: SIVB) collapse spread on Friday… 

So is trading these stocks a good idea? 

As traders, we like to take advantage of volatility. And the bank stocks are definitely volatile… 

But we also have to focus on high-odds setups, weigh risk vs. reward, and stay disciplined enough to stick to our bread-and-butter setups.

There’s a balancing act between taking advantage of opportunities and knowing your limitations. 

So here’s my take on trading bank stocks — take it or leave it…

Should You Dip-Buy Or Short Bank Stocks?

The term I use when sector news like the failure of a bank hits is, “newsy.” 

It means the stocks and sector are too news dependent. 

Now, news catalysts are generally something we look for when we trade penny stocks… 

But when big news like a bank’s failure hits an entire sector it creates an environment where there are too many unknowns. 

And positive or negative news announcements can create overreactions to the upside or downside. 

One minute news reports that banks are failing… 

Then five minutes later a politician or hedge fund manager says the banks are safe. 

Maybe you dip buy regional bank stocks like Western Alliance Bancorporation (NYSE: WAL) and First Republic Bank (NYSE: FRC) because they’re “down too much” and you hear the government will save them. 

Then minutes later a politician says, no we’re not jumping in to save them.

Or maybe you short the bank stocks thinking it’s all over for them and it’s going to be a repeat of 2008. 

Then the news outlets announce a bailout package…

There’s just too much we don’t know.

The politicians and regulators will act like they know what they’re talking about. But nobody really knows until it plays out. 

There’s no edge if you’re thinking about buying these and holding them overnight. Or if you want to short them thinking they’re going to $0.  

Because we just don’t know how this will end. 

The banking stocks are creating a ton of volatility. We like that … but we don’t just buy stocks that are low hoping to sell high. We use a system, good risk management, patterns, and discipline. 

If you have $500 in your brokerage account and have no trading system yet, trading these stocks is like taking your money to the casino and betting it all on black. 

Keep your money in your account and wait for a higher odds setup. 

Stay focused on what you’re trying to build — consistency. 

Penny stocks don’t follow the overall market. And there are still a ton of opportunities out there… 

I had two nice winners yesterday from my weekly watchlist. So you don’t need to be distracted by the overall market noise. 

If you want to know what stocks I’m watching and what I think about overall market news and themes — watch my Market Update videos three times a week! 

You get a ton of bonuses when you join StocksToTrade Advisory — check it out here.

Have a great day everyone. See you back here tomorrow. 

Tim Bohen

Lead Trainer, StocksToTrade

An old theme is back and it’s bringing in gains of 92% and even 108% in a single day…

And it’s happening with the overall market selling off hard. 

So what’s so great about these stocks? 

And what do they have in common? 

Allow me to explain… 

This theme ran wild in 2020 and 2021, but most of the stocks got obliterated in 2022 when risk was off the table for most traders.

But they’re back and offering great day trading opportunities…. 

So let’s take a deep dive into this market theme and how you can trade the opportunities… 

SPACs Return 

Two of the biggest runners in the market yesterday were Ocean Biomedical, Inc. (NASDAQ: OCEA) and Intuitive Machines, Inc. (NASDAQ: LUNR)

OCEA gained as much as 108% and LUNR gained 92%.

OCEA is a biotech stock that announced lung cancer news. LUNR is in the space sector, had no news, and spiked in a giant short squeeze in sympathy to OCEA. 

But if they’re in different sectors, what do they have in common that would make them run together? 

This is why I call it a theme, not a sector — both stocks are SPACs. 

What’s a SPAC? 

It stands for Special Purpose Acquisition Company. It’s basically a shell company that’s created with the purpose to acquire or merge with another company to bring it public. 

It’s a faster and easier way for companies to become publicly traded instead of through an initial public offering (IPO).

SPACs were huge back in 2020 and 2021. The market was raging and companies were eager to become publicly traded so they could take advantage of the market hype and euphoria. It means traders and investors are willing to pay a premium for shares. 

And the company can take advantage of inflated valuations. 

These companies can be far from being profitable … But they’re great for day trading. Here’s how you can take advantage of the moves… 

How To Trade SPACs 

You can trade SPACs using any of the patterns in my ebook. And keep in touch with working in the market by watching my Market Update videos every week. 

If you’ve been watching them and following along recently, you’d know that dip and rips aren’t working right now… 

So you could’ve avoided getting caught in the failed high of day break in OCEA yesterday… 

OCEA chart: 1-day, 2-minute candle — courtesy of StocksToTrade.com

But what is working right now are afternoon moves and multi-day runners. 

I’ve been intentionally avoiding day-oners lately, especially in the morning. But now that OCEA and LUNR have hung around on day one and closed strong… 

You can watch them for a red-to-green move, afternoon VWAP holds…

Or this hot pattern you’re probably not using. 

Learn about them all in my ebook and Market Update videos — you get both as part of StocksToTrade Advisory. 

And today’s Friday, so you know I’ll be looking for an epic Friday squeeze! 

Have a great day everyone. See you back here tomorrow. 

Tim Bohen

Lead Trainer, StocksToTrade

Let me know if this sounds familiar:

You see a stock spiking and you want in … FOMO gets the best of you and you chase it. 

Instead of the stock continuing to break out, it starts to sell off. 

Thinking that it’s just consolidating before it takes out the highs, greed gets the best of you, and you decide to double down.   

Smart right?

Your price average is now lower. 

But stock never ends up recovering, and instead of taking a small initial loss, your loss is magnified because you doubled the size of your position. 

What a disaster. 

But was it just bad luck, or is there an actual case for averaging down? 

It’s a question a lot of newbie traders ask. And today you’ll get my answer.  

Should You Average Down?

Experienced traders average down to lower the average price they paid for their position. 

It can increase profits but also increases your risk if you have to cut a losing trade. Because averaging down means you’ve added more shares to your position. 

The reason experienced traders average down is because they believe the stock they’re trading will bounce. 

They’re using their years of experience to determine that they have high conviction in their trade idea and they think they can maximize the opportunity. 

But new traders don’t have years of experience to guide them.

So let’s look at an example from this week so you can see the dangers of averaging down…

An Example of Averaging Down

A lot of new traders think penny stocks are going to the moon. They think they’ve found the next Tesla, Inc. (NASDAQ: TSLA) or Amazon.com, Inc. (NASDAQ: AMZN).

But that kind of thinking can get you into trouble with penny stocks…

Hypothetically, let’s say you bought 10,000 shares of Troika Media Group, Inc. (NASDAQ: TRKA) at 90 cents on Tuesday when it had a big gap up… 

You think the stock can break through $1 and continue higher — so you hold. 

Then you wake up yesterday and see the stock trading at 30 cents in premarket. You think that it’s a steal so you add another 10,000 shares at 30 cents. 

You now have 20,000 shares at an average of 60 cents. 

But the stock is still trading below your average. So you still have a losing position. 

Now you have to hope the stock bounces back to 60 cents for you to break even. Or above that to have a winning trade. 

If you’re a new trader, that might make sense to you … You think you can just continue to hold until the stock bounces back to 60 cents or above $1 like you originally planned… 

The problem with that plan is that none of these sketchy stocks have to bounce. 

And you’ve just increased your risk… 

If the stock continues lower, you have a bigger position size and a bigger loss when you finally cut it. 

In my Tuesday morning SteadyTrade Team webinar, I called TRKA a 9-cent stock… 

Because I know how it ends for most of these trashy penny stocks. They follow the penny stock lifecycle — and it always ends badly. 

Most of these stocks go back to the price they were trading at before they spiked — sometimes even lower! 

That’s why I say ‘losing traders add to losers, and winners add to winners.’ 

Keep that in mind next time you think you want to add to a losing position and average down.

If you want to learn more rules and lessons to guide you, watch my Market Update videos three times a week. I go over what I’m watching, what I see working in the market, and what traders should look out for. 

Have a great day everyone. See you back here tomorrow. 

Tim Bohen

Lead Trainer, StocksToTrade

Over the last few weeks, we’ve seen stocks like Ambrx Biopharma Inc. (NYSE: AMAM) gain 102%, Unicycive Therapeutics, Inc. (NASDAQ: UNCY) climb 277%, and Cardio Diagnostics Holdings, Inc. (NASDAQ: CDIO) soar 533%!

What did all these huge gainers have in common?

They’re all short squeezes. 

And they’re great moves for day traders because you can catch huge upside moves that usually happen quickly. 

But to catch these moves, you have to be able to recognize when a stock is potentially loaded with short sellers… 

And to do that, you have to understand how they think… 

What moves are they looking for to enter a short position? And what moves on the chart can indicate they’re wrong and in a losing position?

That’s what I’m going to show you today… 

Here are three signs that can indicate a stock has the potential to squeeze — before it does. 

3 Ways You Can Spot A Potential Squeeze 

Before a stock can squeeze shorts to the upside, it has to lure short sellers in. 

So you have to get into the short sellers’ minds and understand whether a stock is full of shorts before you can determine if it has the potential to squeeze. 

And before you can take advantage of the moves on the long side — you have to understand the short side of the trade. 

As long traders we look for stocks to break above key levels before we take an entry to potentially ride more upside momentum. Or we look for dips to support where the stock can potentially bounce. Short sellers do the opposite… 

They look to enter breaks below support believing the stock is shifting momentum to the downside. Or they short spikes into resistance.  

For a stock to have the most potential to squeeze shorts is when short sellers get trapped in a losing position…

What we want to look for is where a stock makes a move that makes short sellers think it’s breaking down, so they pile into positions. 

But then it reverses and continues to the upside. 

This is called a short trap. Here are three examples of what they can look like… 

A Dip Below VWAP 

Day traders use VWAP as an indicator of bullish or bearish price action. If a stock is trading above VWAP it’s often considered bullish. And if it’s trading below VWAP it can be bearish. 

So when a stock dips below VWAP, shorts can look at that as a momentum shift to the downside. And they can start taking positions expecting the stock to continue lower. 

But if the stock holds up, reclaims above VWAP, and goes higher — all the shorts that shorted below VWAP are in a losing position. That adds more buyers to the squeeze when shorts have to buy to cover. 

Look at this chart of Bellerophon Therapeutics, Inc. (NASDAQ: BLPH) yesterday… 

The stock dipped below VWAP in the morning, sucking in even more shorts from the previous day when the stock broke down from its highs… 

And when the stock broke back above VWAP it continued higher, squeezing shorts. 

BLPH chart: 2-day, 2-minute candle — courtesy of StocksToTrade.com

Break Below Support 

A break below a support level can work the same as a break below VWAP — short sellers think it means a shift in momentum to the downside… 

But if the stock dips below support and bounces quickly, that can trap shorts who entered on the breakdown below support. 

Watch this video to see Bryce Tuohey explain what a short trap is and what he saw on the AMTD Digital Inc. (NYSE: HKD) chart before it squeezed to $2,500 in August 2022. 

A Big Red Candle

A big red candle to the downside can indicate a lot of selling pressure. But it can also be created because a stock dips and takes out stop losses.

We typically see a big red candle suck in short sellers when it occurs near the top of a spike near resistance.  

Short sellers can enter when they see selling pressure and use the high of the recent spike as their risk. 

But when the stock breaks above that resistance level, it can create a lot of buy orders as stuck shorts try to exit…

UNCY chart: 2-day, 2-minute candle — courtesy of StocksToTrade.com

You can see that Unicycive Therapeutics, Inc. (NASDAQ: UNCY) had a big red candle when it spiked into resistance on Monday afternoon. 

And when it broke above that level yesterday morning, it created a short squeeze because all the short sellers from the day before were down on their positions.  

Now that you know what can cause some of my favorite moves in the market — find out what I’m watching and what I see working in the market in my weekly Market Update videos. I send them three times a week.

And when you join StocksToTrade Advisory, you also get a detailed monthly report, an exclusive weekly watchlist, and my ebook. 

Have a great day everyone. See you back here tomorrow. 

Tim Bohen

Lead Trainer, StocksToTrade