Investing megathread extravaganza

[DaFace]

A place to talk about investing stuff.

[Rain Man]

Originally Posted by ChiefRocka

WAT?!?

Were you not there?

[Hog's Gone Fishin]

Golden opportunity to make some 100% gains on bank stocks

I grabbed some PACW and FRC for the rebound

[Rain Man]

Originally Posted by Hog's Gone Fishin

Golden opportunity to make some 100% gains on bank stocks

I grabbed some PACW and FRC for the rebound

I'm pondering this as well. I picked up some miniscule amounts of SCHW and ABCB today. I really can't figure out why this stuff would have tanked SCHW so badly.

[Hog's Gone Fishin]

Originally Posted by Rain Man

I'm pondering this as well. I picked up some miniscule amounts of SCHW and ABCB today. I really can't figure out why this stuff would have tanked SCHW so badly.

Over reaction plays at their best

[JohnnyHammersticks]

Originally Posted by ChiefRocka

WAT?!?

I'm just taking a wild guess - I don't know the author of the article or have any super-secret inside info or anything - but maybe they were referring to Feb/March 2020 when the Dow went from almost 30K to 18k in 3 weeks.

Some nonsense called Covid or something. Maybe you were absent or on vacation and didn't hear about it?

[JohnnyHammersticks]

Originally Posted by Hog's Gone Fishin

Golden opportunity to make some 100% gains on bank stocks

I grabbed some PACW and FRC for the rebound

The good news is I got WAL in the low $8's. Was looking for bottoming price action and wanted to buy once it cleared the nearest whole-dollar psychological barrier which turned out to be $8.

The bad news is I piked out in the low $11s out of one of the early volatility halts. I was thrilled at first because it was a scary stock to be in and I was just glad the trade worked, then it went almost straight up over $25 and I wanted to puke. Left a lot of meat on that bone. Almost feels like a loss.

[lewdog]

Originally Posted by JohnnyHammersticks

I know this dude pretty well. We had the same mentor (Tim Sykes) and started in his program at almost exactly the same time. Jack started late 2016, I started early 2017. He's taken it a little further than me at this point, but I'm hot on his heels.

https://www.businessinsider.com/stoc...-4-2023-3?r=rr



A 24-year-old stock trader who made over $8 million in 2 years shares the 4 indicators he uses as his guides to buy and sell
Laila Maidan Mar 12, 2023, 2:00 AM

• One of Jack Kellogg's main indicators is the volume-weighted average price (VWAP).
• This shows the average price paid for shares and helps him gauge sentiment.
• He only uses indicators as a t=rough guide but never trades solely on them, he noted.
• Jack Kellogg began trading stocks right out of high school in 2017.

Five years into his craft, he has already been exposed to various types of market conditions, including the stock market crash of 2020, the raging bull rallies of 2021, and the bear market of 2022. One thing he has learned through it all is to keep things simple and remain flexible.

"There's this acronym: KISS, keep it simple stupid. I don't think people need super fancy indicators to make money trading. I'm just using basic trend lines, support, resistance, volume, and those are all my indicators," Kellogg said. "I think if you overcomplicate the indicators, it will actually throw off your trading because then you're trading more on the indicators than the actual price action."

Spoiler!

This attitude has allowed him to become a versatile trader who takes both long and short positions when appropriate, which helped him to continue trading throughout the bear market of 2022. His tax returns, viewed by Insider, showed that he reported over $8 million in gains from day trading in 2020 and 2021. His returns gained momentum in 2020 when he had a total income of $1.6 million. In 2021, that amount grew to a total income of $6.5 million.

Kellogg has come a long way since starting off with $7,500 which is what he initially deposited when he started trading. His road to success wasn't a straight line. When he first attempted to trade, he was down a few hundred dollars. This led him to realize that he didn't know what he was doing.

So his next moves included switching off real trading and testing his skills through paper trading. Then, he signed up for an online course his parents helped pay for. The program, which was created by Timothy Sykes, a trading teacher and former penny-stock trader known for claiming to flip his bar mitzvah cash gift into over $1 million in gains, helped him develop the skills and patience he then used to craft his skill.

By the time the stock market began to rally hard in 2020, he was ready to ride the upwards wave. In 2022, when the market slowed, he continued to reel in profits by betting on popular stocks like Bed Bath and Beyond (BBBY) and AMC (AMC), the latter of which banked him $60,000, according to a screenshot of his E-Trade brokerage account. He also traded a few small-cap stocks and saw large wins on single trades like Intelligent Living Application Group Inc. (ILAG) which earned him over $91,000, according to screenshots of his Guardian account.

His top 4 indicators
The first indicator he uses as a sentiment guide is the volume-weighted average price (VWAP), which shows the average price paid for shares through all trading adjusted for volume. He uses it on the daily chart as a guide to determine a good buy-in price for the stock he's trading. This keeps him from being a chaser, the term popularly used for those who enter a position too late or after a stock begins to rally.

If the goal is to buy low and sell high, you don't want to pay more than what the average buyer paid, he noted. Therefore, Kellogg won't enter a position if the price is above the VWAP line. The opposite is true if he's shorting a stock: if the price is beneath the VWAP, he generally won't short the stock.

Oftentimes, he'll use this indicator to also determine when to exit his position because that point can sometimes indicate where a stock's price will begin to drop off. The same is also true in reverse: he'll sometimes use the VWAP to determine the price point where he'll cover his position. Therefore, if he shorted a stock at $9 and the VWAP is at $7.50, he'll use that price as a point to lock in profits.

For example, on January 5, he took a short position on ticker AMTD at $2.50. VWAP's center line was trending at around $2.22. So Kellogg covered his position at $2.25 and made a 10% profit.

The next indicator is linear regression, which shows the direction price is trending and when it may change its direction. They are three lines that overlay the candles. The lower and upper lines are the ranges of price movements or volatility, while the center line indicates the average between the two. Price action above the top line signals an overbought stock, and below the bottom line, an oversold stock.

"So the better a stock is respecting the lines of the channel that's created, the more predictable I think the stock's going to be," Kellogg said. This gives him a better sense that the stock's price action will trend according to his thesis.

The next indicator is volume which shows the number of shares being traded at any moment in time. Kellogg mainly uses volume as a potential indicator that a stock may reverse.

"Seeing big volume go through, I know that potentially a lot of people are on the wrong side. So if a big volume spike goes through near the high of the day, it's possible that a lot of people are buying the stock and a lot of people are chasing," Kellogg said.

Finally, he keeps his eye on the support and resistance lines, the former being where the price tends to hold and the latter where it tends to sell off. The levels change throughout the day. Kellogg tries to find the key levels by looking for a parallel increase in volume in those areas. He also pays attention to how many times and for how long a price level holds to determine how strong that point is. While it's not an exact science, general areas where the price hoovers for 30 minutes to an hour are the strongest, he said.

"Eventually, you'll see a bouncing ball-type price action if the stock is going to go lower," Kellogg said. "So you see it bounce from $7 to $8, then bounce again from $7.30 to $7.50, and then bounce from $7.40 to $7.10, then bounce from $7.20 and eventually cracks the support below $7. And then the question is, is it going to create a resistance level at $7 and continue to head lower?"

At the end of the day, price action is king, Kellogg noted. Even if you have a thesis about why a stock's price can move in a certain direction, if the price is moving differently, you need to cut losses.

"I don't ever just base my entire decision off an indicator. So if an indicator isn't agreeing with the trade thesis, then I simply will cut my losses," Kellogg said. "So I've never ever blamed any of my losses ever on an indicator because I don't let it get to that point. If the price action is continuing down, then I will cut my losses or if the price action is continuing up, then I'll cover my short positioning."

Everyone has access and can view the same data — it's really about what you do with that data, he said. Where most traders struggle is with the psychology of trading. You can have the best strategy and indicators, but if you don't have the discipline to stick to it, then you will constantly find yourself in a bad situation. Most people don't put in enough effort to master their emotions, he said.

Man that's awesome. And nice to see he's not using some crazy formulas and mostly just technical analysis.

I'll be honest, my trading only works in bull markets where I can be very successful trading for a profit that's a lot more than the index. However, I don't have the skills to be making money in markets like 2022 and so far 2023. Johnny, what are some of the strategies he'd be using in a market like 2022 to make such good money?

[Hog's Gone Fishin]

Originally Posted by Hog's Gone Fishin

Golden opportunity to make some 100% gains on bank stocks

I grabbed some PACW and FRC for the rebound

Made a killin this morning on both these. Already sold and re entered on the pull back . Plan to grab more if they drop at market open. FRC was at $123 eight days ago. Can't imagine it doesn't hit $75 -$85 within 2 weeks now

[JohnnyHammersticks]

Originally Posted by lewdog

Man that's awesome. And nice to see he's not using some crazy formulas and mostly just technical analysis.

I'll be honest, my trading only works in bull markets where I can be very successful trading for a profit that's a lot more than the index. However, I don't have the skills to be making money in markets like 2022 and so far 2023. Johnny, what are some of the strategies he'd be using in a market like 2022 to make such good money?

He's really just all about price action and studying. He works harder and studies more than anyone I've ever come in contact with in the trading business. He really capitalized on the crazy bull market at the end of 2020 and early 2021. Worked himself to the point of exhaustion and into some health problems that took him awhile to get over. He's toned it down a bit now.

But yeah, he's a master of price action. Whereas newbs are buying breakouts, high of day breaks, etc., Jack is buying the consolidation at the end of a down trend just before it reverses. So he's selling into the newbs who are buying breakouts and HOD breaks.

He also had the balls to size way up during that period in late 2020/early 2021. He crossed $1M in total trading profits in November 2020, and by March 2021 he was over $6M. So he really went all-in during that crazy run.

We're required to integrate our broker's trading platform with a tracking system called Profit.ly, so all our trades are automatically uploaded into their system. So you can't cheat the system or fudge numbers. As the Business Insider article claimed, they verified his numbers with tax returns. I'll attach Jack's Profit.ly profit chart, you can see the almost parabolic rise in his profits at the end of 2020 to early 2021.

[Hog's Gone Fishin]

WAL was at 7.50 yesterday .

Now its at 37

[ChiefRocka]

Originally Posted by JohnnyHammersticks

I'm just taking a wild guess - I don't know the author of the article or have any super-secret inside info or anything - but maybe they were referring to Feb/March 2020 when the Dow went from almost 30K to 18k in 3 weeks.

Some nonsense called Covid or something. Maybe you were absent or on vacation and didn't hear about it?

Four months later it was back at the original level. That was a large extended bear trap. To say this cat is a "seasoned veteran" trader since 2017 is laughable.

[JohnnyHammersticks]

Originally Posted by ChiefRocka

Four months later it was back at the original level. That was a large extended bear trap. To say this cat is a "seasoned veteran" trader since 2017 is laughable.

Whatever you say, Warren Buffoon

[JohnnyHammersticks]

Originally Posted by Hog's Gone Fishin

WAL was at 7.50 yesterday .

Now its at 37

Yeah tell me about it

[Buehler445]

Originally Posted by ChiefRocka

Four months later it was back at the original level. That was a large extended bear trap. To say this cat is a "seasoned veteran" trader since 2017 is laughable.

Yeah, dude, he kind of is.

I'm going to be 40 this year. I graduated in 2002. And I certainly paid attention to the .com bubble and 9/11 I wasn't trading anything there. I got out of grad school in 07, and I had a good $5 maybe $6 in the markets when 2008 happened, the impact to the labor market mattered WAY more than my $5 going to $4 or whatever.

Along my timeline (I understand not everybody goes to grad school and you can invest earlier than I did if you've got the money), but in order for anybody to have real money invested in 2008 along my timeline, they have to be what? 10 years older than me? That's 50 and you need to start looking at taking risk off the table.

That's a pretty narrow swath of dudes that have taken bullets with real capital. PLUS, way more shit has happened since 2017 than from 2008 to 2017. And if the recession lasts very long at all you're going to be pushing for dudes going back to the 80s, and those guys aren't around.

[Rain Man]

Oh, this is nice. When Signature Bank collapsed, they replaced it on the S&P 500 with BG (Bunge). I have a lot of BG stock, and it spiked up since the ETFs will all need to start buying it. Out of the ashes rises a phoenix.