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You Need To Trade THESE Stocks – Short Squeeze Mania

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Written by Timothy Sykes
Updated 2/15/2024 8 min read

Every single day there’s a new stock spiking to INSANE heights.

Let’s go through this week so far:

Monday: Beamr Imaging Ltd. (NASDAQ: BMR) spiked 1,500%.

Tuesday: Digital Brands Group Inc. (NASDAQ: DBGI) spiked 340%.

Wednesday: Datasea Inc. (NASDAQ: DTSS) spiked 1,200%.

Thursday: China Natural Resources Inc. (NASDAQ: CHNR) spiked 750%.

Welcome to Friday, arguably the hottest trading day of the week.

It’s very likely we will see another insane runner.

Nothing’s a 100% guarantee in the market. But luckily we don’t have to predict these runners. They fall right into our laps.

Here’s how it works: We wait for the stock to spike during premarket, and if it matches our framework, we start to plan a trade.

Essentially, this is a two part process:

  1. Find the runner.
  2. Trade the runner.

It’s easier said than done, but that’s why I’m here.

There’s a specific process my millionaire students and I use to pull profits from the market. Follow the rules and your account will stay safe.

Get ready for Friday’s price action!

Two Part Process

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Yesterday’s runner was alerted in premarket hours at 8:29 A.M. Eastern.

This trading tool is ESSENTIAL for side-hustle traders who want to catch the markets hottest stocks in time.

These spikes don’t last forever. You need to pay attention while they’re hot.

There’s a reason the share prices are so cheap: They’re penny stocks. And they’re crap companies.

But … If we’re wise to the scheme, we can ride the short term price action for huge profits.

Take a look at the profit I pulled on CHNR yesterday (starting stake of $4,320)

Source: Profit.ly

And I wasn’t the only one to profit.

Here’s a screenshot of our chatroom:

Source: Profit.ly

There are SO MANY opportunities to profit in this 2024 market.

Especially when these stocks spike with the same catalyst over and over again.

CHNR spiked for the same reason as DTSS from a day earlier. It’s the strongest catalyst in the market right now.

The short squeeze.

These crappy companies start to show bullish momentum during premarket hours.

Degenerate short sellers see the momentum and think:

“This is a crappy stock. It doesn’t deserve to spike.”

And they sell short, trying to capitalize when the stock eventually crashes.

Theoretically, it’s a solid strategy. But when there are too many short sellers in a single stock, a little too much bullish momentum will cause them to panic. They have to buy shares back to exit the position. That ADDS to the bullish momentum. And that’s how we get massive short squeezes.

1. Find The Runner

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Short squeeze runners can be difficult to spot for a new trader.

That’s why the Breaking News alerts are so helpful in the beginning. It’s run by ex-Wall Street guys who know how to identify things like an insane short squeeze.

Usually we trade spikers with bullish news. But there isn’t always a news catalyst that sparks a short squeeze. Sometimes it’s seemingly at random.

That’s why: I don’t predict the short squeeze. That’s impossible.

Instead, I react to what I see in the market.

  • A low priced stock. Below or around $5 at the beginning of the move.
    • The low price is part of the formula: Short sellers can tell the stock is crappy, it adds to their delusional strategy. The low price also helps the price spike higher from a percent perspective, that helps long-biased traders profit.
  • Spiking way more than it should.
    • We usually look for stocks spiking +20% in premarket. But a short squeeze is more obvious, CHNR spiked 750% yesterday in premarket.
  • With a low float.
    • A low float is anything below 10 million shares. The low supply of shares constricts supply for short sellers and long traders alike. It helps the price spike higher. CHNR had a float of 2.5 million shares.

And then …

2. Trade The Runner

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The high of day is the most important level for a short squeeze.

If the stock can break the premarket highs, that’s when short sellers start to max panic. And the stock starts to squeeze.

Here’s how I played CHNR:

CHNR chart 1-day, 2-minute candles Source: StocksToTrade

I saw the bullish momentum as prices started to rip toward $6 resistance.

I bought shares before the breakout and sold into the bullish momentum afterward.

Hindsight is 20/20.

It looks easy on the chart above, but understand that every chart is a little different.

It’s not like they all spike to $6 in premarket and then break out and shoot to $8 before noon. It takes some experience before traders can capitalize on these plays alone.

My students are finding success right now because they’re using the trading tools I developed to accelerate their learning curve.

XGPT is one of the best examples: The AI boom in 2023 led to a tech revolution.

And since I’m always trying to make your learning experience better, I leveraged AI to help traders learn THIS PROCESS.

Now my students can trade as if I’m watching over their shoulder!

  • XGPT announces the best afternoon trade setups using my two-decade tested process.

– AND –

  • Traders can ask XGPT about a ticker they’re watching and it will respond as if I gave you the advice myself.

Those who don’t know how to trade stocks like CHNR: Once you find the next spiker, just enter the ticker into XGPT.

The 2024 Market

The reason why SO MANY traders are profiting right now is because the market is hot.

Three out of four stocks follow the market.

That’s why you need to trade right now!

The profit opportunities for small-account traders are unmatched. But we don’t know when the momentum will shift.

The market ebbs and flows. Take advantage of this intense bullish price action while it lasts.

Make hay while the sun shines.

Cheers.


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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”