The psychology around pops and drops continues to amaze me.
GameStop was a hyped-up short squeeze. Yet, as the price skyrocketed more than 100% in a single day, people kept buying more.
They chased the price higher.
They saw the instant gains people were locking in and it encouraged them to buy more. They were worried they’d miss out on the next pop only to be left holding the bag as the price plummeted back to Earth.
This is the swing of a typical short squeeze.
But on a normal day, when a stock pops 5%, 10% or 20% on good news, people seem to walk away from the opportunity. They say they’ve missed the boat. The gains are all gone.
Call me crazy, but I’d pick that opportunity any day over a company in the middle of a short squeeze.
Volatility vs. Stability
With a short squeeze, what we’re seeing is the fear of missing out. A stock surging 100% is a rare opportunity that pulls people in.
But stocks see quick pops of 5%, 10% or 20% all the time.
And here’s the thing, those smaller gains can signal larger moves down the road. It doesn’t take a short squeeze to jumpstart the push higher.
I keep my eye on jumps that come after an earnings report where the company beat analyst expectations. That means the company reported earnings that are better than what Wall Street analysts had expected.
If the good results help lift the stock higher that day, it can set off a chain reaction that sends shares rocketing further in the coming months.
It’s not 100% overnight — you’re not going to see it on the news.
But, if we can spot stocks that are going to consistently move up double digits, then our profits can add up rapidly.
And, using a powerful market tool, what I call a “Profit Accelerator,” we can take these modest 5%, 10% or 20% moves and turn them into 50%, 100% or even 200% gains in a matter of weeks.
This isn’t a volatile short squeeze — this is a trade on a stable strategy.
Some Stocks Can Deliver These Gains Consistently
Knowing the difference between these two situations — a rally in a stock that is about to plunge, versus the one that is mispriced and headed even higher — is the secret to profiting from the market.
It sounds simple.
But trust me, after seeing the hysteria over GameStop and other pops and drops, I know the opposite happens all the time. People simply buy into the wrong rallies.
And they continue to look at the consistent trends as too boring or not worth their time.
I’ve seen it happen over and over again.
When I recommend trades in my premium research services, I get the emails telling me that we missed out. But those trades can go on to make double- or triple-digit gains despite those naysayers.
Trust me, I get it. On some companies, it’s true, you would have missed out on the gains.
But I don’t try to track all the publicly traded companies in the market. I’ve narrowed it down to only the most profitable stocks to trade — a list of just 75 companies.
The list shows me what to trade each quarter. All I have to do is look at the data and I can know where the next gain will come from.
And in just a couple of weeks, I’m going to reveal all the details.
I’m going to show you specific examples that reveal exactly why I’m willing to bet on these stocks after they pop.
You don’t want to miss out on this presentation — sign up today to get on our wait list to be the first to see it.
Chad Shoop, CMT
Editor, Quick Hit Profits