One Meme stock that had the perfect setup
Have you ever wondered what it would be like to be your own boss?
Travel the world and forget about a 9-5 job?
That’s the benefit of being a trader!
I have been for over 20 years and I’m going to help you get there!
Every morning, no matter where I am in the world, I continue to look for the same pattern.
Why? Well, that’s what I’m going to share with you today.
The pros of recognizing these patterns, understanding how to spot them, and having total control over your everyday life is rewarding.
Now, this won’t come overnight as it will take time to understand these setups, and most importantly, you need to study!
Early in the week, you may have noticed that meme stocks were spiking and the meme frenzy was back in action!
Do you notice any similarities?
It’s important for you to remember and understand that patterns repeat.
As we close out another week, there’s a trade I want to share with you.
So if you are ready to take your trading to the next level, let’s dive in!
Meme Stock Frenzy
It’s hard to turn a blind eye to something, especially with what we’re seeing with these meme stocks over the last week.
Fubotv Inc. (NYSE: FUBO), Party City Holdco Inc. (NYSE: PRTY), Blue Apron Holdings Inc. (NYSE: APRN), GameStop Corp. (NYSE: GME), AMC Entertainment Holdings Inc. (NASDAQ: AMC) the list goes on and on…
All of these stocks had one thing in common earlier this week…
They were all surging to unreal highs.
This isn’t a coincidence: it’s what I like to call a sympathy play.
These plays can create great opportunities for traders. So how did I break down one of my latest trades of these meme stocks?
Let’s take a look…
So why did I trade FUBO compared to all of these other meme stocks?
I love it when stocks drop 10%, 20%, or even more early in the morning after a recent run-up.
These morning panic dip buys are one of my favorite patterns
This is why I continue to look for the same pattern every morning. I know how these patterns tend to play out.
How I traded FUBO
My entire strategy falls around my 7-step pennystocking framework.
I follow the same routine every morning when I scan the market for trading opportunities.
Now, not everything plays out the way it should, and it’s not an exact science…
But you will notice that the morning panic dip buy is a pattern that tends to repeat itself after a run-up over several days or even weeks…
Breaking down my recent trade of FUBO, you’ll notice that I had two entry points.
My first trade entry price was $6.43 and I exited at $6.62 and profited 2.95%
My second trade was from when I noticed a bigger panic and bought at $5.68 and sold at $5.95 and profited 4.75%
*Used $61,140 in capital to gain $2,675
It’s ok to have multiple dip-buys in one day. Whenever the opportunity is right, you want to make sure you capitalize on it!
When I place a dip-buying trade, I don’t tend to stay in these positions for long. Here you can see I was in and out of my position within a matter of minutes!
Now that you have learned where I placed both my trades, how did I determine when the stock would bounce?
There are two ways you can identify where a stock may have resistance and support.
First, when I was breaking down the daily chart, I was able to identify where my two support lines were to help me execute my two trades.
Identifying these support and resistance areas comes with time and experience.
If you’re still learning and studying, there’s an amazing tool a lot of traders use to help them to identify these key resistance and support areas.
If you missed my most recent post, StocksToTrade’s Oracle proprietary algorithm helps select 20 stocks down from thousands that have the greatest upside potential.
Oracle compiles a list of stocks that are roughly half long and half short. It all depends on the day.
This algorithm works in real-time, so you’ll notice that these stocks will switch from green to red, or red to green.
The red circles indicate key resistance levels, or support levels, depending on the direction the stock is moving.
What’s next
You may think a lot of these trades are similar to my other trades…
You should because many of my trades use the same trading patterns.
These patterns have continued to help me profit in over 77% of my trades, no matter how the market is performing.
You may also notice that all of these stocks have some other things in common…
All these fall into my 7-step pennystocking framework.
This has been an incredible week for meme stocks, so I wanted to share with you as much information as possible.
My goal is to make you a profitable self-sufficient trader!
Everyone learns at their own pace…
So continue to review your trades, my trades, and everything I share with you.
See you next week!
Study up!
Tim
