One of the keys to good trading is to find the themes and sectors that are working. Traders gravitate toward those stocks and help to create strong momentum. It is self-fulfilling to some extent, but it has a tendency to persist and can offer some great trading.
Currently, it is the SPAC group of stocks that is red hot. There are plays in electric vehicles, gaming, health foods, power storage and more, that are attracting significant attention. Stocks like Tortoise Acquisition (SHLL) , Forum Merger II (FMCI) and Graf Industrial (GRAF) have been leading the charge and are now consolidating a bit, but traders are actively seeking out the next big move.
My Stock of the Week, Lancadia Holdings II (LCA) , is a gambling-related SPAC that is breaking out to a new all-time high today.
Three other names I'm trading today are B Riley Principal Merger Corp II (BMRG) , which has a deal in the power storage group. This is particularly timely with the problems that California is having with its power grid. The estimates look solid and the name appears to be under the radar.
Spartan Energy Acquisition (SPAQ) is bringing the latest entity created by Electric Vehicle pioneer, Fisker, to the market. This stock has been heavily promoted by some highly visible traders and has not been able to generate sustained momentum, as stuck longs consistently escape into minor strength. I am looking for the stock to eventually move, but it is a frustrating one as it is consistently sold into any and all strength.
These stocks can be quite volatile, but this is where the action is and I expect them to remain very active.