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Pay Attention To This Hot Sector RIGHT NOW

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Written by Timothy Sykes
Updated 3/23/2024 4 min read
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We can find plays in the market by following hot sectors.

For example, one of the hottest sectors right now is AI stocks. That extends into similar tech sectors as well.

NVIDIA Corporation (NASDAQ: NVDA) is one of the overall sector leaders. And when NVDA runs, we often see more AI plays in the small-cap sector.

The small-cap sector has the stocks that we want to trade.

  • They’re cheap.
  • They can spike +1000%.
  • The charts can follow popular trading patterns.

And momentum from the AI sector helps to make these spikes stronger.

AI stocks are still red-hot … but on Friday I noticed another sector creeping back into focus.

Pay attention to hot sectors! Friday’s momentum could continue today, Monday, and this week.

I’ve got all the details …

Weed Stocks

Let’s use Canopy Growth Corporation (NASDAQ: CGC) as our example. The chart shows a lot of good price action and it spiked on Friday, March 22.

CGC chart multi-day, candles Source: StocksToTrade

This stock spiked 150% last week.

Like NVDA in the AI sector, it’s possible CGC is acting as one of the weed-sector leaders. So when you go to trade a weed play this week, check on the strength of CGC’s run. The price action will give us a lot of hints about continued sector strength.

I already snagged a profit from Friday’s run, starting stake of $21,420:

Source: Profit.ly

And CGC is still in play today!

But keep an eye out for any other weed plays that are on the move. This news likely spread over the weekend. With any luck, this week we’ll see a bunch of FOMO traders piling into weed stocks.

Let me make this clear: I’m not trying to predict price action.

I don’t know which stocks will spike. Or even if the weed run will continue. Instead, I let the stocks come to me.

Winning Framework

We’re looking for stocks that …

  • Are in the weed sector.
  • Have a history of running.
  • Are spiking more than 20% on the day.
  • Have at least 1 million shares of trading volume.
  • Have less than 10 million shares in the float
  • Have a low price. Below $5 is the most ideal.

Also,  understand that this is an inexact science. For example, CGC offered some great trade opportunities on Friday. But the stock’s float is 66 million shares.

That’s above our goal of 10 million shares or fewer. But it’s far from the float of blue chip stocks in the industry, NVDA has a float of 2.4 billion shares.

Monday Runners.

I’m looking for weed plays.

I’m looking for AI plays.

I’m looking for biotech plays (another hot sector right now).

There is so much opportunity in this market to profit! Already a lot of my students are realizing the potential right now. See my tweets below:

Get inspired!

There’s another full week of spikers in front of us. Don’t miss your opportunity to profit.

Join my next trading live stream to follow along.

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

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* 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”