Hey, Traders,

Some serious momentum is hitting certain sectors right now, so I thought this would be a perfect opportunity to talk about momentum trading. 

First of all, momentum trading is all about what’s happening right now. 

As a momentum trader, you find a stock that’s moving and ride that wave while it’s moving. 

Momentum often comes from hype, headlines, volume, and emotion all bubbling in the market simultaneously. 

It’s people chasing the same stock at the same time, and all that demand drives up the price (sometimes way too fast). 

That’s where the opportunity comes in.

But it’s only an opportunity if you stay disciplined as the plays are lining up.

Here’s how to catch that wave the right way. 

Where the Runners Are

Right now, momentum is being fueled by a few things. 

First, we’re heading into the end of the year, which means traders are looking for last-chance moves. 

Small caps heat up around this time, and we’ve already seen some low-float runners making big intraday spikes. 

These stocks are usually under $5 a share, and one press release or spike in volume can send them flying. 

That’s classic momentum: no real change in the company, just a sudden rush of buyers.

But it’s not just about penny stocks. 

Lately, we’ve seen momentum in the clean energy space, especially solar and electric vehicle-related names. 

Any time there’s talk about government funding, climate policy, or big partnerships, these stocks light up. 

AI Still Has Sparkle

AI is another hot corner of the market. 

Everyone wants in on the next big thing, and AI still has that buzz. 

Whether it’s small AI chip makers or companies claiming they’re “pivoting” to AI, that story creates spikes. 

If a stock gets volume and starts to trend on social media or in chat rooms, the crowd follows — and that’s where the heat is.

Biotech can also sneak in as a momentum mover, especially with FDA announcements or trial updates. 

One headline can send a small biotech stock up 50%, 100%, or even more in a single day. 

But don’t chase the top. 

These are great for morning spikes and dip buys, but only if the volume and price action support that.

Short-Term Staying Power

Still, it’s not just about sectors but about watching how a stock moves. 

Are the candles strong? Is the volume steady? Are buyers showing up in waves, or was it a one-and-done move? 

Real momentum sticks around for a bit, giving you time to react, plan your entry, and manage your risk. 

Fake momentum fades fast.

What you don’t want to do is fall in love with a stock. 

Momentum trading is quick: You get in and out. It’s about reacting quickly and locking in gains when you have them. 

Chasing green candles without a plan can lead to fast losses, and once the momentum is gone, it’s usually really gone.

So, stay alert. 

Keep an eye on premarket volume, look for news catalysts, watch the social chatter, and track what other traders are watching. 

When something starts moving, be ready to react — but always with a plan. 

Momentum is fast, it’s emotional, and it rewards those who stay prepared.

Stay sharp,
Jack Kellogg