Momentum traders have been intently focused on the electric vehicle sector as these stocks have become grossly overbought. So far names such as Nio (NIO) and Tesla (TSLA) are holding up very well but some of the hot money is rotating into other stocks that have taken off yet. Small oils is a group that is seeing momentum. Cannabis stocks are also seeing interest.
One group I'm looking at very closely here is lithium mining, which is used in the batteries that fuel all those EV plays. There are three main plays --Livent (LTHM) , Lithium Americas (LAC) , and Westwater Resources (WWR) . I'm building positions in LTHM and WWR Tuesday morning.
I also added to pot play Cresco Labs (CRLBF) and may add further to Trulieve Cannabis (TCNNF) later in the day.
My main takeaway right now is that this is a market that is setting up for some very strong small-cap speculative action in the two days surrounding the Thanksgiving holiday. Traders are trying to position in the names that they think will have the best momentum.
There is a lot of hot money out there right now looking for a place to go and it is not afraid of chasing strength.
Keep in mind that the indices are meaningless right now. This is all about trading fast-moving speculative stocks. Don't get caught up in market timing when its sector action that is the key.
