Sometimes what you might think is the best stock to trade ends up being a dud.
And other times the crappiest stocks can go on the craziest runs…
You have to position yourself to be ready for anything.
Learning how to spot these subtleties can mean the difference between a winning trade and a losing one.
This scenario played out exactly on Friday…
Many of my students in my live training liked one stock in particular …
But once I saw certain price action on another chart, I immediately made it my number one watch.
Here’s why it rocketed to the top of my watchlist and ran 161%!
Why This Stock Was My #1 Watch on Friday
In premarket on Friday everyone was talking about Safe and Green Development Corporation (NASDAQ: SGD).
I didn’t like it because the cost of borrowing shares to short was too expensive.
I didn’t think many shorts would pay the $2 per share to short it, so it didn’t have a high probability of squeezing.
Besides that stock, it was quiet on Friday morning…
But then I saw a true penny stock spiking.
Altamira Therapeutics Ltd. (NASDAQ: CYTO) was moving on news that it would sell its stake in its subsidiary company for $2.3 million cash.
As we’ve been doing lately, I waited for the stock to put in the first big five-minute candle in premarket.
Then watched as it pulled back.
It was testing VWAP…
And as soon as it bounced off that level and started heading towards the high of the first big green candle — I made it my number one watch.
CYTO chart: 1-day, 5-minute candle — courtesy of StocksToTrade.com
This time the dip and rip played out as it was meant to — after the market open.
But it was the premarket price action that put the stock on my radar — with the help of the Breaking News Chat bros of course.
It’s the same setup we’ve been watching for all week — a big spike, pullback with consolidation as a risk level, then a re break above the recent high.
The fact that CYTO held the VWAP level (we don’t nitpick over pennies) added more conviction to my trade idea.
If you want to add more conviction to your trade ideas — get the help of the pros.
Join our live training sessions and see the key levels, tools, and strategies we use daily.
It might be what your trading needs to take off!
Have a great day everyone. See you back here tomorrow.
Tim Bohen
Lead Trainer, StocksToTrade