With earnings season in full swing, I’m expecting volatility to pop from its long overdue coma.
Of course, the market has gone straight UP… but with so many catalysts on the table (earnings, geopolitical tensions in the Middle East, and the trade deal) sentiment can shift fast
However, I’m going to remain patient and look for smoke signals before I implement bearish strategies (I’ve already learned my lesson the hard way).
For the time being, I’ll stick to my guns and what’s working for me — small-cap momentum stocks. So far this year, my Jason Bond Picks strategy is up more than $20,000… and I haven’t even been trading a whole lot.
My patterns are able to spot some of the best setups in the small-cap space… and right now, they’ve uncovered three stocks that could make a significant move very soon.
What are those patterns, and what stocks are on my watchlist right now?
Fish Hooks and Rockets Are All You Need
My bread-and-butter setups are the fish hook and rocket… and the best part, you don’t need to study technical analysis for years to spot them.
Let me show you how my fish hook pattern works…
I look for three things to happen:
- The stock to drop significantly.
- Thereafter, the stock must find a support level and hold.
- Last, but not least, the stock needs to bounce off the support level.
Check out the daily chart in Pier 1 Imports (PIR) below.
If you look at PIR right now, it looks like a textbook fish hook setup. The stock suffered a massive drop… found support, and is starting to catch a bounce.
With that being said, when I see this pattern come up in a small-cap stock… I know it’s time to put it on my watchlist and develop a trading plan. Of course, if I make any moves, I’ll be sure to alert my Jason Bond Picks premium clients.
The next stock on my watchlist is also showing signs of a potential bounce. LSB Industries (LXU) is right at a trend line support… and it looks like it’s starting to form the fish hook pattern.
It’s the same idea as with PIR. LXU suffered a massive drop… found some support, and is starting to catch a bounce.
It’s really that simple, and if you can properly execute these trades, you could reel in some massive winners — just as I did with a $12K winner using the same exact pattern.
The Rocket Pattern
The rocket pattern is a little different than the fish hook pattern. You see, with the fish hook pattern, I’m looking for beaten-down names poised to reverse. On the other hand, with the rocket pattern, I’m looking to play for the breakout. In other words, I’m looking for strong stocks here.
For example, take a look at Genetic Technologies (GENE).
With the rocket pattern, you have to be careful because these stocks could go through wild swings. So when I see this pattern come up, I often use the Fibonacci retracement tool to find key entry, stop-loss, and target zones.
Now, I actually traded this stock… and here’s what I sent out to my clients.
Well, the stock didn’t want to break above $5 that day… but the pattern is still intact. So I locked in a small $652 winner. Despite the trade not being a monster, I was glad I stuck to my plan.
I’ll keep this on my watchlist, and I’ll be sure to let my clients know if I make any moves.
If you want to simplify your trading with two simple patterns and not have to worry about market headlines affecting your positions… then click here to watch this exclusive training lesson.
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