Momentum Day Trading Strategies
Hey everyone! Today was a strong day for our Momentum scanners! We had a pretty good gap scan list today but because the overall market was gapping up, there were a lot of sympathy gappers. When I say sympathy gappers, I mean stocks gapping up but without a specific catalysts. I always have to be careful trading stocks gapping without news because something else is driving them. If it’s the overall market and the market rolls over, that stock will roll too. If it’s a sector like Energy, or Housing, and there is news or a change in momentum in that sector, it will quickly impact those stocks. Instead of trading market wide or sector wide strength, I prefer to trade single stock catalysts. Yesterday we had great news on $SPEX that resulted in a big move, today we had no news on $OPXA and we got a quick short squeeze, but then a hard fade. That fade was to be expected since there was nothing to account for the move. Learning to separate the stocks on the gap scanner each morning between those with catalysts and squeeze potential, and those trading in sympathy with other factors is important.
Today I traded $CLRB for a continuation trade. I called out 3.80 as my entry pre-market, with a stop at 3.60. I ended up taking an entry at 3.945 and selling at 4.04 for a quick $425 profit. My next trade was jumping into $CBYL off the hod momentum scanner. Because we’ve seen some big runners of the $1.00 price range, I was more inclined to take a stab at this one than I normally would be. I jumped in long at 1.10 and sold at 1.12 when I saw a big 25k seller sitting at 1.14. I didn’t feel we would have enough buyers to break that level. The final stock I traded was $OPXA. This was alerted on the HOD scanners as a low float stock with massive volume. As soon as I saw the alert in bright yellow I jumped in at 3.25. This hit a high of just over 4.25. A quick 1 point squeeze! I locked up $641 in total profits, scaling in and out on the move through 4.00.