Back in the ihub (investors hub) days, near the time of capitulation, certain less-than-moral people with numerous followers used to pump their penny stocks and sell into the crowd along the way. By nature of their playing in penny stocks, as opposed to options or futures, I’ve come to realize that these people were still rather amateur. Nevertheless, that did not stop them from effectively manipulating discussion boards of sheeple. I learned quickly to avoid stocks where someone would repeatedly post “WEEEEEEEE….ZOOOOOOOOOM….. GAZELLEZZ….. to the MOOOOOOON”.
Stocktwits is an excellent forum of discussion, where people can broadcast opinions, fears, and questions. Some are genuine, and some are shock artists looking to stir up some shit. Stocktwits is head and shoulders above all other investment forums that I’ve come across. Nevertheless, stocktwits is not prone to less-than-moral characters.
The bullet point of this post is to think for yourself. Dont’ take the advice of traders who have thousands of followers, who also blog, or who seemingly give you tips. Don’t even listen to me for that matter. I usually have a position, especially if I am analyzing a stock closely. In fact… don’t listen to anything or anyone but the charts.
Back to my theory…
My hypothesis is that among the hundreds of professional traders on stocktwits, it is nearly impossible that so many of them were genuinely bullish in the past 2 - 3 weeks, during the consolidation. If assholes pumping penny stocks can manipulate a crowd of sheeple, my guess is that professionals trading options and futures, with MBA’s, ex-bankers, chartists, etc., are only more adept at fooling the masses. The system is terribly broken - talk is cheap! I honestly believe that many of the pros were selling into the market while pumping a potential rally.
I’ll be suggesting this to Phil Pearlman next week - that stocktwits is in need of a simple “I have a ___ (bullish or bearish) position” option when posting. This keeps things at least somewhat accountable. For the true stars, their performance can be plotted for the public to see. For those that are simply looking to screw people out of some money, their actions and words will not align, and it will be easy to spot the sleazebags.