We’re deep in the heart of earnings season, and with it comes a flood of hype-filled headlines designed to trigger your FOMO…
“Analyst predicts 500% upside!”
“Wall Street slaps an $8 target on a 50-cent stock!”
Looks like a golden ticket at first glance, doesn’t it?
In fact, the real golden ticket arrives on Monday mornings.
This special window sends stocks flying…
Like Phio Pharmaceuticals (NASDAQ: PHIO), which spiked 134%* last Monday, November 3rd, after announcing positive results from a drug trial.
Good thing I know how to catch these ahead of time! Here’s how it works…
Every Monday, the market kicks back into gear after its weekend nap… and that reset creates a unique opportunity.
As the first session of the week gets started, there’s a specific pattern we look for that appears again and again with uncanny consistency.
And it has given us some unbelievable gains!
We hunt for these Monday morning spikes every single week.
Learn to spot them for yourself and start your week off with a bang!
Don’t wait! Watch the video below for the full trade breakdown and strategy tutorial on my Monday Setup.
What if the headlines you’re chasing aren’t signals at all…
But distractions… or worse, traps?
Table of Contents
What Most Traders Misunderstand About These Spikes
There’s a common data point floating around the trading world. It sounds official, sounds reliable, and for large-cap stocks, often is.
I’m talking about analyst price targets.
At face value, an analyst price target is just what it sounds like, which is a researched estimate of where a stock might go in the future. It’s not a guarantee, but rather a thesis based on company financials, growth potential, sector trends, and news catalysts.
For large-cap stocks like Apple, Google, or Microsoft, you’ve got firms like Morgan Stanley, Goldman Sachs, or JPMorgan doing the work. They’ve got entire teams of MBAs studying balance sheets and macro data.
But with penny stocks, it gets tricky…
The Penny Stock Wild West
When you step out of the Fortune 500 and into the penny stock universe, that “price target” label starts to get murky.
Instead of data-driven research, some of these micro-cap “targets” are little more than creative writing exercises but dressed up in fancy formatting.
These shady firms slap $5 to $10 targets on stocks trading at 30 or 40 cents and suddenly, retail traders start piling in like it’s the next Tesla.
But you have to ask yourself, “Does this company even do anything?”
More often than not, these are companies with no revenue, no scalable product, and no clear business model. They’re not selling software. They’re selling a story and the price target is the pitch.
How the Setup Works (And Why It’s Legal)
This pattern, often called the “price target pop,” is one of the oldest pump tactics in the book.
Here’s the typical play:
A small-cap company needs to raise cash so they partner with a sketchy analyst firm. The firm then publishes a wildly inflated price target.
Thinking it’s a legit rating, retail traders jump in and drive up the price. Insiders and promoters sell into the spike.
The company uses the inflated price to issue more shares (dilution), and the stock crashes back to Earth.
Rinse and repeat every six months.
Shady? Yes. Illegal? Oddly enough, not all the time.
Tradeable? Absolutely…but only if you know exactly what you’re doing.
How to Trade These Without Getting Burned
The secret is knowing what this really is. It’s not investing, it’s momentum trading. And the moment the hype fades, these things collapse hard.
So if you’re going to trade these “target pops,” treat them like what they are, day trades. Remember, you’re trading the price action only. Date the stock, don’t marry it!
Here’s a quick checklist before you ever touch one:
- Low Float: Under 10 million shares is ideal.
- Volume Spike: If it’s moving fast, the market is reacting.
- Sketchy Price Target: The wilder the claim, the better the bait.
- Past Spike History: Has this ticker run before?
- Dilution Patterns: If they diluted before, they’ll do it again.
If all those boxes are checked, and you’re seeing momentum in real time and this is a trade worth watching…
But you’d better have an exit plan before you hit the buy button.
My Final Thoughts…
The secret is knowing what this really is…
It’s not investing, it’s momentum trading. And the moment the hype fades, these things collapse hard.
The “price target pump” isn’t going away. This is how some of these penny stock companies survive. No revenue? No problem… Just engineer the next round of hype.
New traders fall for it every time. They see the report, they believe the target, and they think they’ve found the next moonshot.
But that doesn’t have to be you! These setups can be very profitable as long as you move fast, manage your risk, and never overstay your welcome.
Trade the spike, not the story.
And never confuse a flashy price target with real value.
The market always shows its hand. You just have to know how to see it.
Have a great day, everyone. See you back here tomorrow.
Tim Bohen
Lead Trainer, StocksToTrade
P.S.
Interested in trading crypto? Here’s what I’m watching.
Are you brave enough to trade pre-market?
What about after-hours trading?