Day Trading High Momentum Stocks | Tradingsim Video Lessons

day trading high momentum stockThe broad stock market made a ferocious recovery off of the BREXIT lows.  It was a broad based market rally that essentially retraced everything that was lost.  As a day trader, I look for high momentum stocks to trade on a daily basis.  This week presented challenges in terms of the number of trades available.  Fortunately, there were a couple high flying momo stock out there which presented great opportunities for profit.   One of them was Stone Energy, or ticker: SGY.

The stock was up over 2000% in a couple of days.  It rallied from around .50 all the way over 12.  I wanted to create a video on how you could have traded this stock on the breakout above its most recent rally highs from last week.  There were actually three different entries that you could have taken on this stocks intraday.

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Many of these high momentum stocks are low float issues.  This means that they do not have a very large outstanding float of shares available to trade.  This lack of liquidity provides even more gas for stocks like this to go much higher than most people think they can.  The short covering in momo stocks can create vicious rallies especially when they have wide bid/ask spreads.

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Al Hill Administrator
Co-Founder Tradingsim
Al Hill is one of the co-founders of Tradingsim. He has over 18 years of day trading experience in both the U.S. and Nikkei markets. On a daily basis Al applies his deep skills in systems integration and design strategy to develop features to help retail traders become profitable. When Al is not working on Tradingsim, he can be found spending time with family and friends.
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