By name: microcap-surge-hunter description: Identify micro-cap stocks with 100%+ surge potential BEFORE they move. Use when analyzing penny stocks, nano-caps, or foreign private issuers for explosive volatility plays. Triggers on queries about finding squeeze candidates, low-float setups, compliance restoration plays, reverse split opportunities, short squeeze detection, FPI lock-up expirations, or pre-surge pattern identification. Covers NASDAQ/NYSE American listed Asian ADRs, Chinese stocks, Singapore-domiciled equities, and sub-$100M market cap securities.
Micro-Cap Surge Hunter
Systematic framework for identifying micro-cap stocks with 100%+ intraday surge potential before the move occurs.
Core Patterns
Seven convergent signals precede explosive micro-cap moves. Minimum 3 signals required for entry; 5+ signals = maximum position.
Pattern 1: Compliance Restoration Sequence
Setup:
- Stock trading <$1.00 with active NASDAQ deficiency notice
- Reverse split executed within 30-60 days
- Post-split float <5M shares
Trigger: Form 6-K containing "regained compliance," "Nasdaq Listing Rule 5550(a)(2)," or "minimum bid price requirement"
Entry: Buy on 6-K filing day, first 30 minutes. Position: 2-3% max.
Exit: Scale 50% at +100%, trail remainder with 25% stop from high.
Pattern 2: Reverse Split Float Trap
Setup:
- Split ratio ≥1:8
- Post-split float <2M shares
- Avg daily volume <$500K pre-split
- Market cap <$50M
Entry: 1-3 days after split effective date. Confirm with volume >3x 20-day avg.
Stop: 15% from entry.
Pattern 3: FPI Information Vacuum
Setup:
- Foreign Private Issuer (Cayman, BVI, Singapore, HK domicile)
- IPO within 180 days (lock-up active)
- Zero news flow post-IPO
- Volume collapsed to <$100K daily
Triggers (ranked by explosiveness):
- M&A announcement
- Strategic partnership
- Analyst initiation with >100% upside target
Entry: First 5 minutes of catalyst. Accept slippage.
Pattern 4: Short Interest Collapse
Setup:
- Short interest declining >30% MoM
- Absolute short <50K shares but concentrated
- Days to cover <1
- Float <3M shares
Entry: On SI report showing continued decline + volume >2x 10-day avg.
Position: 3-4% (high conviction squeeze).
Pattern 5: Technical Oversold Extreme
Setup:
- 12-month decline >90%
- RSI <20
- Price <200-day MA by >80%
Entry: First green day with volume >3x avg. Stop: Previous day's low.
Target: 200-day MA (first), 100% gain (second).
Pattern 6: Analyst Upgrade in Nano-Caps
Setup:
- Market cap <$100M
- Coverage by 1-2 analysts only
- Recent operational improvement
Trigger: Price target increase >100% above current price.
Entry: Same day as upgrade, first 15 minutes. Target: 50% of implied upside.
Pattern 7: Sector Thematic Alignment
Setup:
- Company in hot sector (EV, AI, logistics, fintech)
- Asian domicile benefiting from regional sentiment
- Recent positive macro catalyst
Entry: First volume abnormality (>5x avg).
Scanners
Run scanners via scripts/ directory. See references/scanner-specs.md for full query specifications.
| Scanner | Purpose | Key Filter |
|---|---|---|
| compliance_scanner.py | Find compliance restoration candidates | deficiency_notice=TRUE, reverse_split_date>-60d |
| float_trap_scanner.py | Identify post-split float traps | post_split_float<3M, split_date>-30d |
| short_squeeze_scanner.py | Detect short collapse setups | SI_change_30d<-25%, float<5M |
| oversold_scanner.py | Find extreme oversold bounces | RSI<25, price_change_52w<-85% |
Data Requirements
Tier 1 (Essential):
- SEC EDGAR API (free) - 6-K, 8-K, DEF 14A monitoring
- Finviz Elite ($40/mo) - Float, volume, price filters
- Ortex/S3 Partners ($50-100/mo) - Real-time short data
- Benzinga Pro ($117/mo) - Analyst actions, M&A alerts
Tier 2 (Edge):
- IPO Monitor ($200/mo) - Lock-up tracking
- Unusual Whales ($50/mo) - Options flow
- WhaleWisdom ($50/mo) - 13-F tracking
See references/data-sources.md for API endpoints and integration patterns.
Position Management
| Signal Strength | Position Size | Stop Loss | Target |
|---|---|---|---|
| 1 pattern | 1% portfolio | 20% | +50% |
| 2 patterns | 2% portfolio | 15% | +100% |
| 3+ patterns | 3% portfolio | 12% | +150% |
Halt Protocol:
- 1st halt: Assess bid pressure, add 25% on resume if strong
- 2nd halt: No adds, prepare scale-out
- 3rd halt: Exit 50% on resume
- 4th+ halt: Exit all (manipulation risk)
EOD Rules:
- Gains >50%: Hold 50% overnight, sell 50%
- Gains <50%: Exit all before close
Risk Limits
- Max single position: 4%
- Max sector exposure: 10%
- Max correlated positions: 3 stocks
- Daily loss limit: 5%
- Weekly loss limit: 10%
Red Flags (Exit Immediately)
5 halts in single session
- Price action disconnected from any news
- Bid-ask spread >10%
- Coordinated social media pump activity
- Company issues "no news" statement explaining move
Pre-Trade Checklist
Before entry, verify:
- Float <5M shares post corporate action?
- FPI with lock-up still active?
- Recent reverse split ≥1:8?
- Compliance restoration imminent/announced?
- Short interest declining >25%?
- Sector alignment with current theme?
- Volume today >3x 20-day avg?
- Any analyst coverage with aggressive target?
Minimum 3 checks required. 5+ = max position.
Morning Routine
- 6:00 AM: Check overnight 6-K filings (SEC EDGAR, FPI filter)
- 6:30 AM: Review pre-market gappers (>20% in <$100M mcap)
- 7:00 AM: Scan news for triggers: "regained compliance," "reverse split," "acquisition," "partnership"
- 8:00 AM: Check short interest (if bi-monthly report day)
- 9:00 AM: Review watchlist for volume anomalies
- 9:30 AM: Execute on confirmed setups