The crazy volatile shifts we saw in the overall markets yesterday are proof that traders are fickle…
They bounce from one opportunity to another — going long, going short, seemingly changing their minds on a whim.
That’s why hot themes and sectors can come and go FAST…
One day some new tech is all the rage — the next day nobody cares.
Yesterday morning in my SteadyTrade Team webinar, I recognized the artificial intelligence sector was slowing down…
The sector leader C3.ai, Inc. (NYSE: AI) was gapping down after a long multi-day run…
So is the sector dead?
Or will traders change their minds and come back to AI stocks?
Below I’ll share what I’m looking for in AI stocks for them to shift back into high gear…
But I’ll also share how I adapt to these quick changes in the market and the two things you can look for to do the same.
How to Ride Market And Momentum Shifts
As day traders, we learn to move as fast as the markets. We don’t get married to any of these stocks or companies. We strictly trade price action.
So when you’re looking for momentum in the market, follow the volume and hype…
What’s everyone excited about? What are the hot themes or sectors? Where are all the traders’ eyes?
That’s where most of the opportunities are…
Yesterday, it looked like all eyes had shifted from AI stocks to low-float healthcare stocks with news.
The volume and hype were in the big gappers, SeqLL Inc. (NASDAQ: SQL) and Kiora Pharmaceuticals, Inc. (NASDAQ: KPRX).
They had news, high volume, low floats, and float rotation…
KPRX became my number-one watch because it has fewer than two million shares in the float. And it looked like SQL had gone too far, too fast in premarket.
But both had nice morning spikes and trade opportunities.
And being where the opportunities are with a trading plan is how you can grow your account.
So tomorrow I’ll look for the next stock that has news, volume, and hype. And it could be in an AI stock…
I don’t think the hot sector is over yet … We just have to wait for another shift to heat it back up…
The Move That Can Shift Momentum In a Stock and Sector
For us to see the momentum shift back into AI stocks, I’ll look to the sector leader…
If C3.ai, Inc. (NYSE: AI) can switch direction, it can spark all the other stocks in the sector.
And for that, I think a red-to-green move and a breakout could be the momentum shift in the stock and the entire sector needs to heat back up.
I’ll see what the market offers and follow its lead this morning…
And I’ll share my most updated market outlook and thoughts on tickers in my market update video … I send out three per week — sign up to get them here!
Have a great day everyone. See you back here tomorrow.
Tim Bohen
Lead Trainer, StocksToTrade