Nearly 3 decades later, my weekend trade strategy is still going strong.
But I’ve noticed something interesting the past few Fridays…
Maybe it’s because I’m so focused on after-hours trading right now.
Or maybe it’s the biggest theme in the market for the past year.
Either way, it’s changed the way I approach Fridays.
Especially the last three weeks…
Table of Contents
AI, After-Hours, and My Weekend Trade Setup
The AI trade is still going strong thanks to solid earnings by sector leaders like Nvidia (NASDAQ: NVDA).
AI infrastructure is one thing, but what about software companies?
SaaS companies took a big hit earlier this year when people said AI would put them out of business.
So, it helps when a SaaS company like Snowflake Inc. (NYSE: SNOW) reports strong earnings and hypes its AI products.
The bottom line is that AI is still a hot theme and it crosses several sectors.
What happens when sector leaders are strong? It creates…
Penny Stock Sympathy Plays
The whole AI build-out over the past couple years reminds me of the dot com boom. There are a lot of companies changing names and putting AI in every press release.
It’s obvious by now that there are gonna be winners and losers.
There are two big differences:
- We all use tech all the time (and everything is faster)
- There is a TON of physical infrastructure getting built
So, it doesn’t surprise me when a small company releases AI news on a Friday and the stock spikes.
Of course, that doesn’t automatically mean I’m going to take the weekend trade.
Basics of the Weekend Setup
For me to hold a stock over the weekend, it needs to meet certain criteria. Even then, I watch after-hours on Friday and premarket on Monday (just in case).
Here’s what I’m looking for:
- A low-priced intraday spiker closing at, or near, the high of day
- With a catalyst
- Ideally with a low float
- High volume
Obviously, it’s not an exact science, but when I see a stock with all of the above, it’s a prime candidate for my weekend strategy.
Usually, I try to hold it over the weekend and sell into a gap up on Monday morning.
News spreads over the weekend, right? Less meticulous traders see the news and place orders for Monday morning.
Recently, something that used to only happen once in a while is happening more often.
Everything is speeding up because…
After-Hours Trading Is Hot, Hot, Hot
Part of the reason after-hours is so crazy lately is because the PDT rule went away.
So, there are more people trading (and a lot of them trade after work).
And because there are no volatility halts after hours, it’s arguably the best four hours of the day.
So much so that I send out a free after-hours watchlist, the Night Tape, every day after the closing bell.
The crazy thing is that because after-hours trading is so good, my weekend strategy can play out in a few hours (instead of having to hold over the weekend).
It’s the same play, but faster. Check it out…
3 AI-Themed Weekend Trades
Each of these trades was meant to be an over-the-weekend play. I ended up holding a partial position on only one of the three.
August 14: Safe Pro Group Inc. (NASDAQ: SPAI)
I bought earnings winner SPAI into the close after this press release hyping new AI contracts.
SPAI was holding above the morning spike highs and I thought it could run more the next week. My goal was to make 10%–20%.
As you can see, it was a CRAZY after-hours runner. So, I sold into the spike. With my goals met, there was no need to hold over the weekend.
Fast forward to the following Friday…
August 21: AIAI Holdings Corporation (NASDAQ: AIAI)
AIAI was a beaten-down stock that spiked after the company’s CEO released a solid shareholder letter…
AIAI was a little different in that it was $2 a share off its daily highs when I bought.
My thesis was that it could have a strong after-hours spike like SPAI the week before, because of the shareholder letter (and this social media hype).
My goal was anywhere in the $7s or $8s.
It was a beautiful after-hours uptrend, but not quite the same pop as SPAI. Still, it was close to my goals (and I was in Europe) so I locked it in safely and called it a night.
Finally…
August 28: Core AI Holdings (NASDAQ: CHAI)
CHAI was another solid earnings winner that held the majority of its morning spike despite a lackluster overall market that day.
Because of what happened with SSAI and AIAI, I tried the same kind of play again. My goal was 10%–30%, shooting for the day’s high.
I took some gains into the awesome after-hours spike (it’s good to lock in profits when your goals are met).
I tried to give it time on Monday, thinking it might spike at the open. It was a good lesson: next time, take the 20% gain on Friday night.
If you want to get my Weekend Trader alerts so you can take advantage of my all-time favorite play, watch this video now.
Key Takeaway
I’m very happy to take single after single on this strategy.
Especially as AI plays seem to be so easy into the weekend.
I don’t know how long it will last, it depends a lot on the whole AI trade continuing.
But for now, I’ll keep looking for AI plays on Friday.
And if they meet my goals, I’ll lock it in because there’s no need to hold.
Have a great weekend!
Cheers,
– Tim Sykes
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