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Promoters- Tim Sykes Penny Stock Trader

Lessons From This Latest Facebook Scandal

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Written by Timothy Sykes
Updated 10/6/2021 11 min read

Lessons From the Latest Facebook Scandal: Key Takeaways

  • Revealed: The ‘Facebook Files’ whistleblower shows how Facebook prioritizes profits over people.
  • Discover the shocking parallels between Facebook’s behavior and penny stock promoters.
  • How promoters signal the huge drop … while still telling unsuspecting newbs to buy.
  • 3 recently promoted stocks — learn this pattern!
  • Appreciate the misinformation in this industry but don’t become one of the suckers.

Rare Opportunity! Trade With Me All Day on Friday, October 8

It was pretty crazy to see the latest Facebook scandal unfold, with the whistleblower, Frances Haugen, appearing on “60 Minutes.” Haugen is a data scientist and her allegations are pretty damning. She also testified before Congress on October 5.

What the Facebook Whistleblower Revealed

importance of relative volume
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The gist of what Haugen said was that Facebook puts its profits ahead of concern for the general public. She went into detail about how the company treats misinformation and hate speech.

It’s not a total surprise, but the interview shows that Facebook had knowledge of what they were doing. She presents her case well. I highly recommend you watch her interview.

Facebook’s director of policy communications responded to the “60 Minutes” report

“We’ve invested heavily in people and technology to keep our platform safe, and have made fighting misinformation and providing authoritative information a priority.”

That sounds a lot like when a promoter tweets…

“The team doing this DD is PAYING for some of the research. Like an investment. People don’t seem to understand this. Why pay for it if it’s not legit? This is happening. Get on board.”

Promoters and Facebook: The Parallels

It’s not an exact comparison, obviously. Promoters aren’t legit. They’re not a big, profitable, powerful company. But promoters do prioritize their profits ahead of education and information.

Facebook Whistleblower Lessons On Misinformation

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This was my initial take…

Now let’s look at the parallels…

Promoters and Facebook Value Misinformation Over the Truth

Again, Facebook vs. penny stocks isn’t an exact comparison. But it’s similar in that misinformation online leads people to do stupid things.

In her interview, Haugen said, “Facebook is trying to optimize for what it calls meaningful social interactions. And those are reacts, likes, [and] comments.”

Misinformation gets better interaction. It’s more polarizing. That’s more profitable for Facebook and publishers. So publishers start to recognize what drives the most traffic from Facebook. And then they publish more polarizing content.

Promoters say a stock is spiking because of the “DD and catalysts.” (DD is promoter speak for due diligence.) But it’s all part of a misinformation campaign. They say, “this company is revolutionizing this industry, it’s gonna change the world.” It’s not — it’s a pump.

Newbies and idiots fall for it, hook, line, and sinker.

Promoters and Facebook Value Profits Over People

While at Facebook, Haugen said she saw “[…] conflicts of interest between what was good for the public, and what was good for Facebook. And Facebook, over and over again, chose to optimize for its own interests like making more money.”

Promoters prioritize their own promo jobs. They sell their own positions or allow whoever hired them to sell their positions. And they value that over the truth.

Promoters and Facebook Use Anger to Lure in Newbies and Idiots

Haugen also said, “Publishers know you are more likely to engage with angry content. There is a perfect reverse correlation … the more angry you are, the more traffic leaves Facebook and goes to the publishing site.”

According to Haugen, Facebook’s own internal studies show that they know this creates civil unrest. She said that in some countries, misinformation was directly leading to people dying. The allegations are pretty damning.

I’m not suggesting that what promoters do leads to people dying. But they do try to lure in newbies by making them angry. They don’t want you to leave Twitter or their chat room — they want you to buy their pump.

They do it by attacking me for trying to educate people. They say, “Sykes and his followers are shorting. Hold the line. Let’s make him feel the pain.” Especially near the end of the promotion.

After seeing it enough times, I realized what they were doing. Now I have a new way to spot the top of a penny stock pump.

Why the Facebook Whistleblower Took a Stand

how to calculate relative volume
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When asked why she took a stand, Frances Haugen said…

“Imagine you know what’s going on inside of Facebook and you know no one on the outside knows.” She even went on to say Facebook should declare moral bankruptcy. She thinks there should be regulations and a complete reset at Facebook.

For me, it’s a little different…

Not a Normal Whistleblower

My goal isn’t to get the promoters to stop. I don’t want the promoters to stop. Frankly, they create the best patterns and predictable trading opportunities. (And I’m eternally grateful.)

Here are three examples of big-time promoted stocks from the past year. Notice the similarity in the charts

HUMBL Inc. (OTCPK: HMBL)

This stock was my single biggest winner of the past two years.* (Note: HMBL formerly traded as TSNP.)

HMBL chart: 1-year to Oct. 5, 2021, promoted penny stock — courtesy of StocksToTrade.com

I’m eternally grateful for the promoters, whoever they are. I want these stocks to go as high as possible because that creates more volatility. More upside eventually creates more downside.

Labor Smart/Takeover Industries (OTC Dark or Defunct: LTNC)

LTNC is another example of a stock that ran with a crazy number of promoters…

LTNC chart: 1-year to Oct. 5, 2021, promoted penny stock — courtesy of StocksToTrade.com

LTNC promoters even started the #LTNCArmy hashtag. They had hundreds of newbies duped into believing it was a “single stock retirement plan.” NOT!

One of the first pumps where I started recognizing the promoter attacks was…

Green Globe International, Inc.

Promoters used dozens of fake accounts to attack me, saying I was short selling. All I ever did was buy GGII.*

GGII chart: 1-year to 10-05-2021, promoted penny stock — courtesy of StocksToTrade.com

Once I started getting attacked, it blew me away how many fake accounts there were. Only recently did I really put two and two together. Whenever they start attacking me, it signals the top of the pump.

And I also think it could be just a handful of promoters using bot farms in a foreign country.

The most important thing to understand is…

Penny Stock Promotions End the Same Way Every Time

the bottom line on support and resistance
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Promoted penny stocks have been around for decades — long before I started trading.

I’m eternally grateful for the promoters, whoever they are. But I do want to highlight their behavior to educate people.

You don’t have to go down with the ship.

Instead, learn to exploit the informational inefficiency. I want these stocks to go as high as possible because that creates more volatility. More upside eventually creates more downside.

It’s the Same Pattern

It’s the same story every time. It astounds me that anybody looking at these charts doesn’t see it.

Frances Haugen couldn’t ignore what she saw happening at Facebook again and again. I can’t ignore what I see happening with promoters. Especially now that they’re signaling the top. I’ll just keep teaching what I’ve seen in 20+ years of trading and now 13 years of teaching.

Watch Me Trade in Real Time

Want to see it in real time? I’m doing another all-day live trading webinar on Friday. It’s a great way to learn my process. You can ask questions, watch me trade, and get my take on the markets that day.

Register for Trading Mastery Here

But let me suggest one thing…

Some people show up without questions ready — they’re not prepared. So prepare ahead of time.

What should you study? Start with the links in this post — especially How to Spot the Top of a Penny Stock Pump in 2021. And also Learn the 7-Step Pennystocking Framework.

Then…

If you haven’t already been through it, at least start the 30-Day Bootcamp before Friday. (It covers the 7-step framework and how promoters lure in newbies.) If you’ve already been through it, now’s the time to review.

What do you think of the parallels between Facebook and penny stock promoters? Comment below, I love to hear from all my readers!

Disclaimers

*​​Results are not typical and will vary from person to person. Making money trading stocks takes time, dedication, and hard work.  Most who receive free or paid content will make little or no money because they will not apply the skills being taught. Any results displayed are exceptional. We do not guarantee any outcome regarding your earnings or income as the factors that impact such results are numerous and uncontrollable. 


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Author card Timothy Sykes picture

Timothy Sykes

Tim Sykes is a penny stock trader and teacher who became a self-made millionaire by the age of 22 by trading $12,415 of bar mitzvah money. After becoming disenchanted with the hedge fund world, he established the Tim Sykes Trading Challenge to teach aspiring traders how to follow his trading strategies. He’s been featured in a variety of media outlets including CNN, Larry King, Steve Harvey, Forbes, Men’s Journal, and more. He’s also an active philanthropist and environmental activist, a co-founder of Karmagawa, and has donated millions of dollars to charity. Read More

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* Results are not typical and will vary from person to person. Making money trading stocks takes time, dedication, and hard work. There are inherent risks involved with investing in the stock market, including the loss of your investment. Past performance in the market is not indicative of future results. Any investment is at your own risk. See Terms of Service here

The available research on day trading suggests that most active traders lose money. Fees and overtrading are major contributors to these losses.

A 2000 study called “Trading is Hazardous to Your Wealth: The Common Stock Investment Performance of Individual Investors” evaluated 66,465 U.S. households that held stocks from 1991 to 1996. The households that traded most averaged an 11.4% annual return during a period where the overall market gained 17.9%. These lower returns were attributed to overconfidence.

A 2014 paper (revised 2019) titled “Learning Fast or Slow?” analyzed the complete transaction history of the Taiwan Stock Exchange between 1992 and 2006. It looked at the ongoing performance of day traders in this sample, and found that 97% of day traders can expect to lose money from trading, and more than 90% of all day trading volume can be traced to investors who predictably lose money. Additionally, it tied the behavior of gamblers and drivers who get more speeding tickets to overtrading, and cited studies showing that legalized gambling has an inverse effect on trading volume.

A 2019 research study (revised 2020) called “Day Trading for a Living?” observed 19,646 Brazilian futures contract traders who started day trading from 2013 to 2015, and recorded two years of their trading activity. The study authors found that 97% of traders with more than 300 days actively trading lost money, and only 1.1% earned more than the Brazilian minimum wage ($16 USD per day). They hypothesized that the greater returns shown in previous studies did not differentiate between frequent day traders and those who traded rarely, and that more frequent trading activity decreases the chance of profitability.

These studies show the wide variance of the available data on day trading profitability. One thing that seems clear from the research is that most day traders lose money .

Millionaire Media 66 W Flagler St. Ste. 900 Miami, FL 33130 United States (205) 851-0506 This is for information purposes only as Millionaire Media LLC nor Timothy Sykes is registered as a securities broker-dealer or an investment adviser. No information herein is intended as securities brokerage, investment, tax, accounting or legal advice, as an offer or solicitation of an offer to sell or buy, or as an endorsement, recommendation or sponsorship of any company, security or fund. Millionaire Media LLC and Timothy Sykes cannot and does not assess, verify or guarantee the adequacy, accuracy or completeness of any information, the suitability or profitability of any particular investment, or the potential value of any investment or informational source. The reader bears responsibility for his/her own investment research and decisions, should seek the advice of a qualified securities professional before making any investment, and investigate and fully understand any and all risks before investing. Millionaire Media LLC and Timothy Sykes in no way warrants the solvency, financial condition, or investment advisability of any of the securities mentioned in communications or websites. In addition, Millionaire Media LLC and Timothy Sykes accepts no liability whatsoever for any direct or consequential loss arising from any use of this information. This information is not intended to be used as the sole basis of any investment decision, nor should it be construed as advice designed to meet the investment needs of any particular investor. Past performance is not necessarily indicative of future returns.

Citations for Disclaimer

Barber, Brad M. and Odean, Terrance, Trading is Hazardous to Your Wealth: The Common Stock Investment Performance of Individual Investors. Available at SSRN: “Day Trading for a Living?”

Barber, Brad M. and Lee, Yi-Tsung and Liu, Yu-Jane and Odean, Terrance and Zhang, Ke, Learning Fast or Slow? (May 28, 2019). Forthcoming: Review of Asset Pricing Studies, Available at SSRN: “https://ssrn.com/abstract=2535636”

Chague, Fernando and De-Losso, Rodrigo and Giovannetti, Bruno, Day Trading for a Living? (June 11, 2020). Available at SSRN: “https://ssrn.com/abstract=3423101”