Yesterday was wild!

I’ve lost track of the number of impressive moves I saw across the board.

I’m talking about moves to the upside and downside. This market appears to be a scalper’s dream right now! 

First of all, yesterday, the market stretched its range and continued with momentum to the downside, finishing down over 1% on the day.

Taking a look at small-cap biotechs and the broader biotech space, with XBI and IBB, both continued their sluggish start to the year and closed negative on the day.

Amid the sea of red across the market, one stock showed incredible momentum, traded far above-average volume, and closed the day up 45.37%.

This will be an action-packed piece, gang, because not only is there a lot to cover in the stock, but I also want to share one of my favorite indicators with you and show you how it helps me make trade decisions.

So, first, let’s cover the impressive mover from yesterday!

G Medical Innovations (GMVD)

Yesterday was a day to remember for GMVD stockholders after shares soared over 45% on the day.

The stock has an average volume of 1.2M. However, yesterday’s volume clocked in at over 30M shares traded.

With the range expansion, momentum to the upside, and significant volume and liquidity, the opportunities were indeed there in the stock.

Before we get into the fun stuff, here’s a quick snapshot of the company.

GMVD, according to Yahoo, is an early commercial-stage healthcare company that engages in the development of next-generation mobile health and telemedicine solutions in the United States, China, and Israel.

Key Stats, per Finviz:

Market Cap: 82.86M

Float: 8.64M

Average Volume: 1.2M

Short Interest: 0.16%

The Action Yesterday

The stock spent the better part of the morning in an ascending triangle before finally breaking out and running as high as $6.74.

After that move and keeping tabs on the stock throughout the day, I devised my plan and let my members know, in real-time, what I was thinking.

I was looking for a pullback into the previous resistance from the morning, and support of the Bollinger Band, at $5 for a possible entry (highlighted yellow).

Unfortunately, the stock was just too strong and never gave me my entry, as it only pulled back to $5.29 before closing the day above $6.

So, why was I looking at $5, and how did I incorporate the Bollinger band into that?

Here’s a screenshot of a recording I posted yesterday evening to my members, where I went over in detail my thoughts on GMVD going forward and how to use the Bollinger Bands.

I use Bollinger Bands to help determine whether the price of a stock is high or low on a relative basis. The Bollinger Bands consist of an upper band, a lower band, and a moving average which is the middle line.

Firstly I look to use Bollinger Bands because they show me volatility. When the Bands are wider or open, they might suggest more volatility.

When they are compressed, they tell me that there is a possibility for less volatility.

Notice when the stock pulled back around 2.30 pm and traded into the lower band. I liked the pullback, and I wanted $5 as the entry area for a long because that was the previous breakout point from the morning.

Here’s another way I look at and use the Bollinger Bands.

I knew I missed the entry once the stock reversed and crossed over the middle line, or the moving average, around 3 pm. 

Often, a move like that signals that the stock might trend higher and trade towards the upper band.

Lone, and behold, that’s exactly what happened.

The Bottom Line and Could this Turn into a Mega Squeezer?

Not getting my entry is part of the game, gang.

In a sense, I’m pleased because I had a plan and stuck to it. After missing my entry, I never chased or acted out of frustration.

Sometimes you have to be ok with missing it.

Anything is possible in this market. One thing I think that this stock needs more of to continue its surge higher is short interest.

It needs fuel for the fire.

So with that being said, if this stock is going to continue to the upside, I think it might need to trap shorts first to gather steam for the upside.