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Watchlists-Penny Stock Investment Strategy

5 Stock Watchlist:

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Written by Timothy Sykes
Reviewed by Jack Kellogg Fact-checked by Ellis Hobbs
Updated 9/25/2024 4 min read

Welcome traders,

It’s essential that we’re watching the right stocks.

There are thousands of stocks moving every day. But only a handful will give us true opportunities to profit.

For new traders, learning which stocks to dedicate our time to is one of the first major lessons.

I’m going to share my list of hot stocks from this week. If we’re watching any of the same tickers, give yourself a huge pat on the back!

It shows you’re headed in the right direction.

Here are some of the biggest movers from this week that could still show us bullish volatility:

  • POET Technologies Inc. (NASDAQ: POET) spiked 70% this week.
    • This company announced an AI technology partnership with Mitsubishi Electric.
  • Kaival Brands Innovations Group Inc. (NASDAQ: KAVL) spiked 240%*.
    • KAVL entered a merger agreement with Delta Corp. Holdings Ltd.
  • Maison Solutions Inc. (NASDAQ: MSS) spiked 160%*.
    • Announced quarterly financial results: A net income of $700k and a revenue of $29.6M.
  • Laser Photonics Corporation (NASDAQ: LASE) spiked 90%.
    • This is a HUGE short squeeze that began August in the $2 range … It spiked to $19 this last Monday. See my post on X.
  • Banzai International Inc. (NASDAQ: BNZI spiked 170%*.
    • It announced a $24.8 million debt payoff. And the company currently only has a market cap. of $4.2 million …

These are the stocks that have shown us bullish momentum this week. And the charts suggest they could continue that trajectory.

Now … It’s not a 100% guarantee, we still need to trade them using tested patterns.

But at least we know that we’re watching the right tickers.

That’s half the battle.

This is an easy scan that you can build to whittle down thousands of stocks every day:

  • A float lower than 10 million shares.
  • A price between $0 and $5.
  • A trading volume of more than 1 million shares.
  • Recent news (available in StocksToTrade).
  • A spike of at least 20%.

Bookmark this blog post so that you can reference these scan factors whenever you’d like.

How To Trade My Patterns

how to read earnings reports the components
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I use the same patterns over and over again.

They’re the same patterns that my millionaire students use to trade.

We’re not gambling on these runners. There’s a specific process.

And thankfully, it’s not rocket science. You don’t need to be a genius to understand these patterns.

But … It’s not easy.

A lot of people don’t understand how to apply these patterns even after I’ve shown them.

Here’s why: Every stock spike is a little different. Like a snowflake. You need to see a ton of stock spikes to recognize the distinct commonality between them.

All of my millionaire students gained enough experience to recognize these patterns in the market.

And right now, maybe for the first time, my students can study AND trade at the same time.

Over multiple months, I prompted an AI bot with all of the stock spikes that match my framework. And after a while, the AI started to catch on …

It’s called XGPT. And this week it called trades on spikers like POET. Take a look at the trade alert below:

POET chart multi-day, 1-minute candles Source: StocksToTrade

Use XGPT to build smart trade plans, it uses the same patterns as my millionaire students and myself!

  • You’ve got the scan to find these runners.
  • You’ve got an AI system to help build smart positions.
  • It’s time to get to work!

Cheers.

 

 

*Past performance does not indicate future results


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Author card Timothy Sykes picture

Timothy Sykes

Tim Sykes is a penny stock trader and teacher who became a self-made millionaire by the age of 22 by trading $12,415 of bar mitzvah money. After becoming disenchanted with the hedge fund world, he established the Tim Sykes Trading Challenge to teach aspiring traders how to follow his trading strategies. He’s been featured in a variety of media outlets including CNN, Larry King, Steve Harvey, Forbes, Men’s Journal, and more. He’s also an active philanthropist and environmental activist, a co-founder of Karmagawa, and has donated millions of dollars to charity. Read More

* Results are not typical and will vary from person to person. Making money trading stocks takes time, dedication, and hard work. There are inherent risks involved with investing in the stock market, including the loss of your investment. Past performance in the market is not indicative of future results. Any investment is at your own risk. See Terms of Service here

The available research on day trading suggests that most active traders lose money. Fees and overtrading are major contributors to these losses.

A 2000 study called “Trading is Hazardous to Your Wealth: The Common Stock Investment Performance of Individual Investors” evaluated 66,465 U.S. households that held stocks from 1991 to 1996. The households that traded most averaged an 11.4% annual return during a period where the overall market gained 17.9%. These lower returns were attributed to overconfidence.

A 2014 paper (revised 2019) titled “Learning Fast or Slow?” analyzed the complete transaction history of the Taiwan Stock Exchange between 1992 and 2006. It looked at the ongoing performance of day traders in this sample, and found that 97% of day traders can expect to lose money from trading, and more than 90% of all day trading volume can be traced to investors who predictably lose money. Additionally, it tied the behavior of gamblers and drivers who get more speeding tickets to overtrading, and cited studies showing that legalized gambling has an inverse effect on trading volume.

A 2019 research study (revised 2020) called “Day Trading for a Living?” observed 19,646 Brazilian futures contract traders who started day trading from 2013 to 2015, and recorded two years of their trading activity. The study authors found that 97% of traders with more than 300 days actively trading lost money, and only 1.1% earned more than the Brazilian minimum wage ($16 USD per day). They hypothesized that the greater returns shown in previous studies did not differentiate between frequent day traders and those who traded rarely, and that more frequent trading activity decreases the chance of profitability.

These studies show the wide variance of the available data on day trading profitability. One thing that seems clear from the research is that most day traders lose money .

Millionaire Media 66 W Flagler St. Ste. 900 Miami, FL 33130 United States (888) 878-3621 This is for information purposes only as Millionaire Media LLC nor Timothy Sykes is registered as a securities broker-dealer or an investment adviser. No information herein is intended as securities brokerage, investment, tax, accounting or legal advice, as an offer or solicitation of an offer to sell or buy, or as an endorsement, recommendation or sponsorship of any company, security or fund. Millionaire Media LLC and Timothy Sykes cannot and does not assess, verify or guarantee the adequacy, accuracy or completeness of any information, the suitability or profitability of any particular investment, or the potential value of any investment or informational source. The reader bears responsibility for his/her own investment research and decisions, should seek the advice of a qualified securities professional before making any investment, and investigate and fully understand any and all risks before investing. Millionaire Media LLC and Timothy Sykes in no way warrants the solvency, financial condition, or investment advisability of any of the securities mentioned in communications or websites. In addition, Millionaire Media LLC and Timothy Sykes accepts no liability whatsoever for any direct or consequential loss arising from any use of this information. This information is not intended to be used as the sole basis of any investment decision, nor should it be construed as advice designed to meet the investment needs of any particular investor. Past performance is not necessarily indicative of future returns.

Citations for Disclaimer

Barber, Brad M. and Odean, Terrance, Trading is Hazardous to Your Wealth: The Common Stock Investment Performance of Individual Investors. Available at SSRN: “Day Trading for a Living?”

Barber, Brad M. and Lee, Yi-Tsung and Liu, Yu-Jane and Odean, Terrance and Zhang, Ke, Learning Fast or Slow? (May 28, 2019). Forthcoming: Review of Asset Pricing Studies, Available at SSRN: “https://ssrn.com/abstract=2535636”

Chague, Fernando and De-Losso, Rodrigo and Giovannetti, Bruno, Day Trading for a Living? (June 11, 2020). Available at SSRN: “https://ssrn.com/abstract=3423101”