Trading News
May. 26, 20234 min read

What to look for in artificial intelligence stocks

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Written by Tim Bohen

How can you take advantage of the artificial intelligence boom that’s driving big tech names like NVIDIA Corporation (NASDAQ: NVDA) to move 30% in a day?

Or Microsoft Corporation (NASDAQ: MSFT) to move 49% year to date…

And Alphabet Inc. (NASDAQ: GOOGL) to see over 21% gains this month alone. 

If you have a small account, you can try to buy a few shares and hold them for swing trades… 

But why try to make double-digit percent gains in a few weeks when you can trade penny stocks with the potential to move double-digit percentages in a few minutes? 

Those volatile moves to help you grow your account faster over time

But you need the right strategy… 

So here’s the best approach I see right now to take advantage of artificial intelligence plays.

This isn’t a technique I often preach about… 

How To Find Artificial Intelligence Stock Opportunities 

In my morning SteadyTrade Team webinar yesterday, I was blown away to see a company as large as NVDA up 30%… 

And I said right at the beginning of my webinar that my focus, for now, is day one artificial intelligence plays. 

That might be surprising to some readers… 

I normally like to focus on multi-day runners or day-two movers since they can offer some of the best opportunities. 

But when you’re in a market or a hot sector that is heavily news dependent, you’re going to see a lot of stocks pop up with artificial intelligence headlines or some kind of news tying them to the sector. 

Companies pivoting their business is one of the signs of a penny stock hot sector.

That doesn’t mean there aren’t other trades out there. 

But one of my favorite quotes by Confucius is, “he who chases many rabbits catches none.” 

So you have to focus. 

And I think over the next few weeks, the best potential trades will be in day one artificial intelligence stocks with news. 

Especially as the large-cap tech names get more and more overextended and higher priced… 

Eventually, the momentum will slow down and they’ll pull back … And that can bring the big money back into small and mid-cap stocks as traders look for more opportunities. 

So how do you find the best potential artificial intelligence stocks to trade?

  • Look for stocks with artificial intelligence news in premarket. They don’t even have to be tech stocks — biotechs can announce using AI in potential treatments or diagnostics, E-learning stocks can use AI for teaching. So any sector can try to get in on the hype. 
  • Look for stocks that get associated with a larger company. Often penny stocks will try to align themselves with legitimate companies in a press release to try to ride the hype. Like we saw with Beamr Imaging Ltd. (NASDAQ: BMR) yesterday — the company dropped a PR in premarket tying it to NVDA

Wearable Devices Ltd. (NASDAQ: WLDS), “a technology growth company developing AI-powered touchless sensing wearables” was another AI spiker yesterday morning after announcing news with Apple in the headline

In my morning webinar, I said to watch WLDS for a break above $1 — it ripped to $1.90!

BMR eventually failed in the afternoon after its morning spike. So you can’t believe the hype in any of these penny stock companies… 

But tomorrow there could be another two or more stocks with AI news in premarket. 

Get the tool that can alert you to headlines with the potential to move stocks — just like it did yesterday before WLDS’s wild 196% gain! 

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

 

Tim Bohen

Lead Trainer, StocksToTrade