I made a bold call in my morning live webinar yesterday…
CXApp Inc. (NASDAQ: CXAI) was gapping up in the morning and everyone was excited about it.
But I didn’t love it for a morning trade.
If you saw the moves it made yesterday morning you might think, “Shut up, you old man. You don’t know what you’re talking about…”
Because CXAI had a nice spike to $10, then to $11.
But all of the criteria CXAI had made it perfect for something even better.
I’ll show you what it is and give you some tips to trade these…
The Better Setup For CXAI
CXAI checked a lot of boxes yesterday morning…
It was gapping up, it was green, it’s in a hot sector, and the OG AI stock C3.ai, Inc. (NYSE: AI) had news…
Plus, CXAI was still up almost 300% from where it was a couple of weeks ago.
But the reason I didn’t love it for a morning trade was because it became a chat pump in premarket.
And nine out of 10 fail at the open.
But a chat pump survivor becomes a top afternoon watch…
And they can have explosive moves.
When it ran a couple of weeks ago it went from $5 to $10 after an afternoon VWAP move.
That’s why I made it my Daily Double Down pick during my noon webinar. (You get a daily live webinar at noon with a stock pick and plan as part of your Daily Market Profits subscription.)
And right at noon is basically when it made its high of day break move…
CXAI chart: 1-day, 5-minute candle — courtesy of StocksToTrade.com
My Afternoon Trading Tips
High-of-day breaks in the afternoon can be powerful moves because short sellers have had all morning to take positions and try to guess the top…
That means when the stock breaks the high of the day, all of them are underwater.
And chat pump survivors, hot sector stocks, and stocks that hold the green to red level after a few days of selling off are good candidates for short squeezes.
You can use my afternoon VWAP scan to find stocks that can fit this pattern.
And you can use the Oracle levels to guide your trade. (The Oracle support and resistance indicator comes standard on StocksToTrade.)
Look how CXAI held the support level above VWAP after it broke the high of the day. Then went to the next resistance level…
CXAI chart: 1-day, 5-minute candle — courtesy of StocksToTrade.com
That can help you plan your goals for a trade, so you lock in profits.
So when you think you’ve missed morning moves — sit back and wait for the pattern that works great in low-float hot sector stocks and chat pump survivors.
Have a great day everyone. See you back here tomorrow.
Tim Bohen
Lead Trainer, StocksToTrade