The special purpose acquisition company Churchill Capital Corp IV (NYSE: CCIV) has caught the eye of Tim Quast, founder and CEO of Market Structure EDGE.
The SPAC announced Feb. 22 that it’s merging with Lucid Motors.
“[The] sentiment has bottomed, so I look at this purely from a market structure standpoint and say, ‘wow, this is very interesting now,'” Quast said Monday on Benzinga’s PreMarket Prep show.
“If you want to make money in something, you leave when sentiment has topped and begins to slide. Then you return when sentiment rises.”
Quast’s Stock Ideas: The next stock on Quast’s radar is Eaton Corp (NYSE: ETN).
“Sometimes you go where people aren’t and you get your return there,” he said, calling Eaton a “great stock to trade.”
When sentiment “ticks back over five, which it just did, that tends to be a great time to own it,” he said.
PreMarket Prep co-host Dennis Dick said he loves buying stocks near the highs.
“If this thing can break out over that $142 [level], I think you are giving us some good ideas here this morning.”
Quast named The Walt Disney Company (NYSE: DIS) as another stock with short volume that shot up right at options expiration.
Short volume is now below the trend and sentiment is ticking up, he said.
“In terms of market structure, that looks appealing.”
Producer Spencer Israel asked Quast for an update on Palantir Technologies Inc. (NYSE: PLTR).
What is interesting about Palantir is “how difficult it has been for this stock to recover,” Quast said.
“At some point, money is coming back to this.”
For reference, the average hold time for one of Quast’s trades is five days.
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