We’ve seen a 500% gainer and a 250%+ gainer in two back-to-back market days…
But yesterday’s big gainer left some traders sitting on the sidelines … Or did it…?
Even though this big gainer is higher priced…
And your account size forced you to miss out on a potential trade…
There’s another way you can capitalize on big gainers.
I’ll show you how today…
Plus, I gave you one of these trade ideas for free on my weekly watchlist. So small account traders — take notes…
Tim Sykes is offering eight days of crazy deals to celebrate Hanukkah — see what’s on special today here!
The 250% Gainer That Sparked Three Sympathy Plays
The big news of the day was massive runner Madrigal Pharmaceuticals, Inc. (NASDAQ: MDGL)…
This is a higher-priced biotech stock with news.
The Breaking News Chat team alerted it when it was gapping up from $63.80 to $197 — for the day it gained over 250%!
The company announced topline results from a Phase 3 trial for its liver fibrosis treatment.
MDGL even took a play from the penny stock playbook and put out an anticipatory press release on Sunday. They told people ahead of time that news was coming out.
So think of it this way, why would a company put out a press release on Sunday telling people news was coming if it was going to be bad news? They wouldn’t want anyone to know.
And that early press release can help build FOMO. So when the news drops people want to get in.
Also, remember there are different phases of biotech studies and trials…
Phase 3 is near the end of the trial process, so good news from a later stage trial is more meaningful than early results.
But with MDGL trading at around $200 per share, it can be tough to trade with a small account.
The good news is, there were more biotech runners yesterday — with and without news…
Three Biotech Sympathy Plays
The Breaking News Chat team alerted Viking Therapeutics, Inc. (NASDAQ: VKTX) as a sympathy play to MDGL…
The stock has no news of its own but it spiked from $4.02 to $8.25 in premarket.
The other big spiker was Summit Therapeutics Inc. (NASDAQ: SMMT). I’ve been watching it for weeks. I thought it would have a big squeeze on Friday since it’s been holding up so well.
In Pre-Market Prep yesterday I said I think there’s something big in store for SMMT…
And that’s when we got the breakout move I said to watch for on my weekly watchlist — a red-to-green move and a break over $3.75.
It made almost a $2 per share move…
SMMT chart: 1-day, 2-minute candle — courtesy of StocksToTrade.com
Another sympathy play was Soleno Therapeutics, Inc. (NASDAQ: SLNO). The company had its own news about receiving up to $60 million in capital.
The stock was on Oracle with a signal price of $1.30 — it went as high as $2.42!
All these stocks are in the biotech sector. (Don’t forget this lesson when it comes to these sketchy stocks.)
So the next time you see a big gainer in a specific sector — look for sympathy plays.
They can often be the best opportunities of the day.
Have a great day everyone. See you back here tomorrow.
Tim Bohen
Lead Trainer, StocksToTrade
P.S. Give yourself the gift of everything StocksToTrade this holiday — our limited-time holiday sale is on NOW! Don’t miss it!