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How To Trade The Newest AI Spike

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Written by Timothy Sykes
Updated 4/25/2024 4 min read
How To Trade The Newest AI Spike Thumbnail

Yesterday we watched Amesite Inc. (NASDAQ: AMST) spike 110%.

In less than 24 hours!

I snagged a 15% profit with one trade. See my notes below, with a starting stake of $14,742:

Source: Profit.ly

And there’s a chance it pushes higher in the next few days.

Here’s why:

  • Volatile stocks in our niche can spike for multiple days.
  • StocksToTrade shows a float of only 1.7 million shares.
    • Anything below 10 million shares is considered a low supply. The low supply helps prices spike higher when demand increases.
  • The company announced successfully launching an AI app to “empower 5.2 million nurses” during premarket on April 24.
  • It has a history of spiking, the price launched 90% between December ‘23 and January ‘24.
    • Past spikers can spike again.
  • The chart shows consolidation intraday on April 24 that parallels the highs from the past spike.
    • See the chart below, every candle represents one trading day:
AMST chart multi-month, 1-day candles Source: StocksToTrade

How To Trade This Runner

We have to wait for confirmation of a move toward the recent highs.

There are likely bag holders from yesterday, April 24, who are eager to unload once the price pushes higher. That’s important to remember while we trade this runner.

Take a look at the April 24 intraday chart below for more information, every candle represents one trading minute:

AMST chart intraday, 1-minute candles Source: StocksToTrade

And it’s why I keep telling all of my students to use the Breaking News tool!

I had eyes on this runner right when it started to spike during premarket. I got there before all of the bag holders.

Take a look below at the Breaking News alert overlaid on a one-minute chart:

AMST chart intraday, 1-minute candles Source: StocksToTrade

We see new Breaking News runners like this every single week!

Here’s where I look for the next alert.

Everyone who has eyes on this stock right now … they have to play catchup. But keep watching AMST. There’s likely still a trade opportunity.

Support and Resistance

Support and resistance are a huge part of my trading process. The same process I’ve taught to over 30 of my millionaire students.

For those who are new, watch my video below to learn how we use these lines to profit off of volatile stocks:

https://content.timothysykes.com/wp-content/plugins/wp-youtube-lyte/lyteCache.php?origThumbUrl=%2F%2Fi.ytimg.com%2Fvi%2FT-_jjttg8Ss%2Fmaxresdefault.jpg

Those who already have a good understanding of support and resistance, quit wasting time …

We’re tracking AMST right now, LIVE.

Don’t risk your account in this market, follow me and my millionaire students as we outline these setups.

Keep studying!

Cheers.

 

*Past performance does not indicate future results

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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”