TSLA has had a euphoric Bitcoin type of run lately. It pains me to see everyone buying the top day after day. Greed and FOMO are both a powerful force. TSLA stock is going to destroy so many people financially directly because of greed. Look out below... a big crash is on the way and TSLA will lead that crash.
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banana with face
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I am almost certain that elites targeted TSLA to attract enough retail FOMO to fund their much needed exit liquidity. The next will likely be funds rebalancing over to a net short for the next big wave of selling in this crash. The increasing gap between the rich and poor is about to grow exponentially when this plays out...
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This seems like a carefully timed news release...
This seems like a carefully timed news release...
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It looks like TSLA is taking a page from the old Bitcoin book!
It looks like TSLA is taking a page from the old Bitcoin book!
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Mandatory Trading Vocabulary of 2020 and Advice Resource by Joseph Sterling
(what I had time to write down for now)
Writing this down also helps me just as much as it helps others. Trading is such a fascinating field that supplies its participants with an endless variety of mental stimulation from an unlimited source each and every day.
Advice-
Respect the industry and the professionals who dominate it. You wouldn't get in the ring with Mike Tyson and expect to win without respect for the sport and proper training, would you? If you answered no, why would you want to put money at risk stepping into the ring with Wall Street heavyweights?
Accumulation Phase-
The accumulation phase is a stage of consolidation. There is no clear trend, and the stock is usually trading in a range. It's a span of time in which traders and institutions are slowly accumulating shares, but the market has not broken out yet. It's also referred to as a “basing” period. This is where I prefer to buy assets. This is the zone at which stocks are too boring, fear is too elevated for the sheep to have any interest, and aren't able to see the value in times of fear or boredom. I use technical analysis to find more calculated entry prices proceeding markup and distribution phases. It doesn't make sense to keep capital tied up in a stock when you know a better price will become available by simply exercising patience. Smart money would be buying TSLA in an accumulation zone and then selling throughout the distribution phase for a massive gain above their cost basis). You can look back to the past on the TSLA and identify the accumulation phase quite easily. This was the time when nobody was talking about it (quiet period). Having substantial capital to spread out in accumulation phases gives you the advantage of having the time to keep that capital tied up while waiting for the distribution phase (hype, media, etc). It will require a lot of self-control and a proper plan to get through the long period of little to no price action in the accumulation phase, but just think of how glorious the distribution phase will be. For example, TSLA is in a peak distribution phase right now in April 2020. Your 3rd and 5th cousins, your high school janitor, and even the cashier at 7-11 are all telling you to buy TSLA stock or you are an idiot and will be sorry if you don't. All of these indicators are a clear indication of peak distribution and professional offloading. There are going to be huge buying opportunities for those who recognize and see all of this for what it is rather than what the media, noobs, and hype cycle are all projecting. I am patiently waiting for the next wave of selling in this bear market.
Markup Phase-
A breakout of the accumulation period starts the cycle. Trend and momentum investors make the bulk of their gains during this phase, as a stock's price continues higher. In this part of the stock cycle, traders use indicators, such as moving averages and trend lines, to help make investment decisions
Distribution Phase-
The distribution phase begins as the markup phase ends and price enters another range period. The shares are being sold over a period of time – the opposite of accumulation. This time, the sellers want to maintain higher prices (TSLA bubble) until the shares are sold at a high premium. Inexperienced traders buy stocks at a premium in the distribution phase from the experienced traders who bought those same stocks in the accumulation and markup phases.
Warren Buffet said it best. "The stock market is a device for transferring money from the impatient to the patient."
Margin call- A demand from your brokerage for you to add money to your account or closeout positions to bring your account back to the required level of funds
(what I had time to write down for now)
Writing this down also helps me just as much as it helps others. Trading is such a fascinating field that supplies its participants with an endless variety of mental stimulation from an unlimited source each and every day.
Advice-
Respect the industry and the professionals who dominate it. You wouldn't get in the ring with Mike Tyson and expect to win without respect for the sport and proper training, would you? If you answered no, why would you want to put money at risk stepping into the ring with Wall Street heavyweights?
Accumulation Phase-
The accumulation phase is a stage of consolidation. There is no clear trend, and the stock is usually trading in a range. It's a span of time in which traders and institutions are slowly accumulating shares, but the market has not broken out yet. It's also referred to as a “basing” period. This is where I prefer to buy assets. This is the zone at which stocks are too boring, fear is too elevated for the sheep to have any interest, and aren't able to see the value in times of fear or boredom. I use technical analysis to find more calculated entry prices proceeding markup and distribution phases. It doesn't make sense to keep capital tied up in a stock when you know a better price will become available by simply exercising patience. Smart money would be buying TSLA in an accumulation zone and then selling throughout the distribution phase for a massive gain above their cost basis). You can look back to the past on the TSLA and identify the accumulation phase quite easily. This was the time when nobody was talking about it (quiet period). Having substantial capital to spread out in accumulation phases gives you the advantage of having the time to keep that capital tied up while waiting for the distribution phase (hype, media, etc). It will require a lot of self-control and a proper plan to get through the long period of little to no price action in the accumulation phase, but just think of how glorious the distribution phase will be. For example, TSLA is in a peak distribution phase right now in April 2020. Your 3rd and 5th cousins, your high school janitor, and even the cashier at 7-11 are all telling you to buy TSLA stock or you are an idiot and will be sorry if you don't. All of these indicators are a clear indication of peak distribution and professional offloading. There are going to be huge buying opportunities for those who recognize and see all of this for what it is rather than what the media, noobs, and hype cycle are all projecting. I am patiently waiting for the next wave of selling in this bear market.
Markup Phase-
A breakout of the accumulation period starts the cycle. Trend and momentum investors make the bulk of their gains during this phase, as a stock's price continues higher. In this part of the stock cycle, traders use indicators, such as moving averages and trend lines, to help make investment decisions
Distribution Phase-
The distribution phase begins as the markup phase ends and price enters another range period. The shares are being sold over a period of time – the opposite of accumulation. This time, the sellers want to maintain higher prices (TSLA bubble) until the shares are sold at a high premium. Inexperienced traders buy stocks at a premium in the distribution phase from the experienced traders who bought those same stocks in the accumulation and markup phases.
Warren Buffet said it best. "The stock market is a device for transferring money from the impatient to the patient."
Margin call- A demand from your brokerage for you to add money to your account or closeout positions to bring your account back to the required level of funds
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Margin Call Liquidation-
If you can't add money to your account to satisfy the margin call, your brokerage has the right to sell off the positions and also charge any commissions, fees, and interest to the account holder to protect its margin loan value. Traders usually lose everything and blow up their accounts using margin.
Volume-
A measure of how much of a given financial asset has traded in a period of time. For stocks, volume is measured in the number of shares traded and, for futures and options, it is based on how many contracts have changed hands.
Liquidity-
How easy it is to buy and sell shares of a security without affecting the asset's price. This means there is a large amount of money in the trade. This enables you to get in and out of the trade easily because there are plenty of buyers and sellers willing to buy or sell that asset at many different price levels.
Supply and Demand Zones (pivot points)-
When a high volume of buy orders exist at a specific price below the current market price it's called bid support (also referred to as bid support and buy walls on Level 2 data feeds. And referred to as support levels by technical analysts who draw these support levels on their charts. These support levels translate to demand as buyers are willing to defend that price level and won't give up against the bears without a fight. Due to poor emotional control and lack of experience, amateurs typically panic sell in demand zones only to see the price bid up after they sold for a loss. Demand zones translate to an accumulation phase attitude amongst professional traders. Amateurs also typically buy in supply zones only to see the price sell off after they bought the top. These amateurs often hold that unrealized loss and eventually sell at an even bigger loss when it sells off to the next demand zone. Supply zones translate to a distribution phase attitude amongst professional traders. This is often why they fall victim to the self destructive sell low, buy high behavior.sell out of fear or don't buy Large sell orders at a certain price above the current price indicate a price that sellers won't let the bulls pass through without a fight (also referred to as sell walls on Level 2 data feeds, and resistance levels on charts used by technical analysts). When overall supply and demand changes trend, it's called a pivot point. I trade weekly chart pivot points to stay deep out of overall risk. The longer the timeframe, the bigger the spread between supply and demand levels, and the further you are from your entry price when it all plays out. I let the unaware day traders stress themselves out by endlessly hashing out intraday prices while I am confident in the bigger picture. My trades take weeks to months to materialize to their eventual sale after entry. It often takes that same amount of time in waiting to buy a stock after I find it. Just because I like a stock it doesn't mean the most risk adverse entry point is presenting itself. I analyze the technicals and put it on a list that is part of a system of lists that are on a trading rotation. Patience is everything.
If you can't add money to your account to satisfy the margin call, your brokerage has the right to sell off the positions and also charge any commissions, fees, and interest to the account holder to protect its margin loan value. Traders usually lose everything and blow up their accounts using margin.
Volume-
A measure of how much of a given financial asset has traded in a period of time. For stocks, volume is measured in the number of shares traded and, for futures and options, it is based on how many contracts have changed hands.
Liquidity-
How easy it is to buy and sell shares of a security without affecting the asset's price. This means there is a large amount of money in the trade. This enables you to get in and out of the trade easily because there are plenty of buyers and sellers willing to buy or sell that asset at many different price levels.
Supply and Demand Zones (pivot points)-
When a high volume of buy orders exist at a specific price below the current market price it's called bid support (also referred to as bid support and buy walls on Level 2 data feeds. And referred to as support levels by technical analysts who draw these support levels on their charts. These support levels translate to demand as buyers are willing to defend that price level and won't give up against the bears without a fight. Due to poor emotional control and lack of experience, amateurs typically panic sell in demand zones only to see the price bid up after they sold for a loss. Demand zones translate to an accumulation phase attitude amongst professional traders. Amateurs also typically buy in supply zones only to see the price sell off after they bought the top. These amateurs often hold that unrealized loss and eventually sell at an even bigger loss when it sells off to the next demand zone. Supply zones translate to a distribution phase attitude amongst professional traders. This is often why they fall victim to the self destructive sell low, buy high behavior.sell out of fear or don't buy Large sell orders at a certain price above the current price indicate a price that sellers won't let the bulls pass through without a fight (also referred to as sell walls on Level 2 data feeds, and resistance levels on charts used by technical analysts). When overall supply and demand changes trend, it's called a pivot point. I trade weekly chart pivot points to stay deep out of overall risk. The longer the timeframe, the bigger the spread between supply and demand levels, and the further you are from your entry price when it all plays out. I let the unaware day traders stress themselves out by endlessly hashing out intraday prices while I am confident in the bigger picture. My trades take weeks to months to materialize to their eventual sale after entry. It often takes that same amount of time in waiting to buy a stock after I find it. Just because I like a stock it doesn't mean the most risk adverse entry point is presenting itself. I analyze the technicals and put it on a list that is part of a system of lists that are on a trading rotation. Patience is everything.
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Relationship between volume and Liquidity-
A large volume spike proceeds a trend reversal (a giant red volume bar on the daily chart likely indicates seller exhaustion and indicates a reversal, the inverse is true for a large green volume bar equalling buyer exhaustion).
Shares Outstanding- Total number of shares
Share Float- Shares available on the open market (not held by insiders or borrowed on margin by short sellers) I target low float stocks with high short interest... short squeeze!
Short Interest- The ratio of shares outstanding that are held by short-sellers
Volume-
The number of shares traded per day measured by dollar amount. Reference the float to see if the volume is worthy for a trade. No volume + Low liquidity= getting stuck in a trade that doesn't move and is nearly impossible to exit. Noobs learn this within their first few months (in most cases).
Blow off tops and bottoms-
Blow offs are a chart pattern that shows a steep and rapid increase in a security's price and trading volume, normally outside of a predictive chart pattern followed by a steep and rapid drop in price usually on significant or high volume as well.
I call the final accelerated push an impulse wave. Impulse waves are fueled by retail greed and FOMO causing a hyper-accelerated rise in asset prices. Smart money uses this influx of cash (liquidity) as funding to exit the trade with a huge profit with the help of high-frequency trade machines. This liquidity event is also used to burn retail long and shorts in a flash crash manner in both directions before the predicted trend change occurs at the blowoff top or bottom. The traders are usually right about their trend prediction but impulse waves are designed to destroy margin traders on both sides of the trade before resuming the trend. Blow off tops usually happen in a single asset, do all of what I described above, and print the giant volume bar, as I mentioned above in the Relationship between volume and Liquidity. Blow off tops in single assets that resemble a bubble and illogical price action often signal a market-wide top and trend change in the current overall trend. (I'm predicting that TSLA is going to be the blow-off top that signals the market-wide topping out of this bear rally followed by resuming the course of bear market selling.)
Options Vocabulary -
look these up on your own if you are interested.
Strike price, in and out of the money options, puts, married puts, bear put spread calls, covered call, bull call spread, naked call, greeks, open interest; put/call ratio, max pain, time decay, expiration, triple witching, strangle, straddle, iron condor, collars, butterfly, iron butterfly, and the rest of the infinite factors.....
I don't trade with margin or anything that requires borrowing in any capacity. This includes leveraged buying, selling short or leveraged short positions, options, futures or anything leveraged. This is my personal preference, I am not downplaying these products as many people see success with them. Self-awareness is important. I know what I'm good at, what I'm bad at, and what compromises my success. Margin is the enemy of my success... and it's way too stressful babysitting positions!
A large volume spike proceeds a trend reversal (a giant red volume bar on the daily chart likely indicates seller exhaustion and indicates a reversal, the inverse is true for a large green volume bar equalling buyer exhaustion).
Shares Outstanding- Total number of shares
Share Float- Shares available on the open market (not held by insiders or borrowed on margin by short sellers) I target low float stocks with high short interest... short squeeze!
Short Interest- The ratio of shares outstanding that are held by short-sellers
Volume-
The number of shares traded per day measured by dollar amount. Reference the float to see if the volume is worthy for a trade. No volume + Low liquidity= getting stuck in a trade that doesn't move and is nearly impossible to exit. Noobs learn this within their first few months (in most cases).
Blow off tops and bottoms-
Blow offs are a chart pattern that shows a steep and rapid increase in a security's price and trading volume, normally outside of a predictive chart pattern followed by a steep and rapid drop in price usually on significant or high volume as well.
I call the final accelerated push an impulse wave. Impulse waves are fueled by retail greed and FOMO causing a hyper-accelerated rise in asset prices. Smart money uses this influx of cash (liquidity) as funding to exit the trade with a huge profit with the help of high-frequency trade machines. This liquidity event is also used to burn retail long and shorts in a flash crash manner in both directions before the predicted trend change occurs at the blowoff top or bottom. The traders are usually right about their trend prediction but impulse waves are designed to destroy margin traders on both sides of the trade before resuming the trend. Blow off tops usually happen in a single asset, do all of what I described above, and print the giant volume bar, as I mentioned above in the Relationship between volume and Liquidity. Blow off tops in single assets that resemble a bubble and illogical price action often signal a market-wide top and trend change in the current overall trend. (I'm predicting that TSLA is going to be the blow-off top that signals the market-wide topping out of this bear rally followed by resuming the course of bear market selling.)
Options Vocabulary -
look these up on your own if you are interested.
Strike price, in and out of the money options, puts, married puts, bear put spread calls, covered call, bull call spread, naked call, greeks, open interest; put/call ratio, max pain, time decay, expiration, triple witching, strangle, straddle, iron condor, collars, butterfly, iron butterfly, and the rest of the infinite factors.....
I don't trade with margin or anything that requires borrowing in any capacity. This includes leveraged buying, selling short or leveraged short positions, options, futures or anything leveraged. This is my personal preference, I am not downplaying these products as many people see success with them. Self-awareness is important. I know what I'm good at, what I'm bad at, and what compromises my success. Margin is the enemy of my success... and it's way too stressful babysitting positions!
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Excuse the typos and sentence errors, I can't go back and edit.