Recently, while watching the markets, I noticed many people asking the same question: if long-term positions are not moving, should I switch to short-term trading? Actually, the logic of short-term trading is quite simple — it relies on quick capital turnover and price fluctuations to profit from price differences, usually completing buy and sell transactions within a day or a few days. However, behind what seems simple, it requires strong discipline, quick reactions, and risk control.

I found that many people's losses are often not due to choosing the wrong stocks, but because the stock selection itself lacks logic. Short-term trading doesn't need to rely on fundamental analysis; even companies with long-term growth prospects can experience periods of price pullback or consolidation. The key is to find targets that are truly suitable for short-term operations.

A qualified short-term stock should have three characteristics: have a theme, high trading volume, and large price fluctuations. The theme is what attracts investors to buy and sell, which can be industry trends, policy changes, financial reports, or major company news. Currently, AI and semiconductors are the clearest themes, which is why NVIDIA has always been a favorite among short-term traders.

Sufficient trading volume is very important because short-term investing fears nothing more than being able to buy in but not sell out. Stocks with high trading volume have several advantages: smaller bid-ask spreads, faster price reactions, and your entries and exits won't affect the trend. If you pick stocks with poor liquidity, even correct judgments are useless because you might not be able to sell at all.

Price volatility is also a key factor. Some stocks, even with themes and high trading volume, have small fluctuations, making them more suitable for long-term rather than short-term investing. Compared to Walmart, Tesla's volatility is much higher because retail investor sentiment is intense, and Elon Musk's posts can trigger 5% to 10% swings.

The period around earnings announcements is a golden time for short-term traders. When a company releases earnings, the market will have expectations for the next quarter. Whether the actual numbers meet, exceed, or fall short of expectations, the stock price will react directly. This often results in gap up or gap down movements, presenting opportunities for short-term trading. When Netflix beats earnings estimates, its stock jumps on the open; Meta drops sharply if earnings are below expectations. These clear signals are very valuable for short-term traders.

Based on these characteristics, I categorize stocks suitable for short-term trading into five major types. The first category is AI and semiconductors, which are currently the most obvious capital themes in the market. Stocks like NVIDIA, AMD, INTC, and SMCI are worth watching. Chips and server-related stocks tend to have high volatility and rapid capital flow.

The second category is high-volatility theme stocks. These stocks often experience explosive gap moves, with relatively clean technical signals, but their liquidity is not as good as leading stocks, so traders need to watch out for slippage when entering or exiting. Many people treat them as junk stocks, but that's not true — they have clear themes, just with larger fluctuations driven by market sentiment.

The third category is crypto-related concept stocks. If you want to participate in crypto volatility without directly trading Bitcoin, Coinbase and MicroStrategy are the most straightforward alternatives. When Bitcoin rises, they rise; when Bitcoin falls, they fall — their rhythm is very aligned. Moreover, these stocks often have even larger fluctuations than Bitcoin because they add stock market premiums and sentiment.

The fourth category is high-popularity blue-chip stocks. Tesla and Palantir are typical examples. Their movements are not driven by fundamentals but by popularity. Retail investor capital tends to concentrate in these stocks, leading to rapid rises and falls. The advantage is that they always have sufficient liquidity and discussion, and technical signals tend to be more reliable.

The fifth category is event-driven stocks. They may not move much normally, but when earnings or major news come out, they instantly become focal points. Oracle, for example, often sees implied volatility spike around earnings releases, with the stock easily gapping more than 5% on the same day. Besides earnings, major contracts, new product launches, and regulatory rulings are also triggers.

If you're truly interested in short-term trading, I recommend starting with highly liquid U.S. stocks. U.S. stocks have large trading volumes, no transaction fees, and allow multiple trades within the same day, providing greater flexibility. Most importantly, you need to develop trading discipline, set stop-losses, and treat these stocks as tools rather than beliefs. First, familiarize yourself with the volatility rhythm using a demo account, then consider small capital operations. Success in short-term trading depends not on choosing the right stocks a few times, but on long-term discipline and risk management.