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Promoters- Tim Sykes Penny Stock Trader

Make Penny Stock Promoters Pay

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Written by Timothy Sykes
Updated 6/9/2022 6 min read

OTC stocks are not nearly as regulated as listed NYSE and Nasdaq stocks.

Stock promoters know this … and that’s why you see so many pump-and-dump schemes on penny stocks.

These promoters will straight up lie, cheat, and steal if you give them the chance.

However, I call them out the second I notice their B.S.

And I show my students what to look out for so they’re not deceived.

Before social media, promoters had to rely on email lists and newsletters.

Today, they pop onto my Twitter account and make outrageous claims they can’t back up.

All my trades are listed for anyone to view right here.

The good news is that anyone can recognize these jackals for who they are.

Once you do that, it’s a simple matter of exploiting them for some amazing trades.

Here’s how it works.

Purpose of Promoters

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Like in any industry, there are good and bad actors out there, with many playing in the gray area.

At the good end, you get public relations and communications firms hired by a company, or working internally, to highlight material developments.

Think of a biotechnology company that puts a new drug into a trial or announces the results.

These are legitimate, newsworthy items that investors care about.

But what happens when a company puts out a press release that talks about an event that’s already known or highlights information already available in their recent earnings release?

That’s where things start to get a little murky, especially if it occurs as insiders unload shares.

At the other end of the spectrum you get social media jockeys on Twitter, Discord, and the like pushing pump and dump schemes.

These thieves will talk up a stock in chat rooms and wherever else they get eyeballs, duping people to buy shares.

Little do folks know, these guys already own the stock and are using the ‘pump’ to push price higher so they can unload at a profit.

A while back, I wrote a piece on the arrest of a promoter. This is a great piece to help you understand some of the more unsavory tactics of these guys.

The point of any of these guys is they want shares to move higher until they’ve completed the goal, whatever that may be.

Spotting Promoters

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It doesn’t take much to find a stock promoted by pumpers.

Back in 2020, I created a video that highlighted many of their tactics.

You can still spot many of those same signs today.

A good example I saw recently was InnerScope Hearing Technologies, Inc. (OTC: INND).

On June 6th, the company issued a press release stating that INND had received a purchase order from Walmart for $11 million worth of product.

Okay, fair enough. When the company’s annual revenues haven’t topped $1 million, this can be a big deal. But they also haven’t completed the order yet.

And if the electric vehicle craze has taught us anything, it’s that purchase orders can vanish into thin air.

What really caught my attention were Twitter accounts talking about how the company was now the ‘real deal’ and all sorts of garbage.

Almost every company I’ve ever seen in the OTC markets is junk.

So, when I hear these promoters come out of the woodwork, I start to take notice.

And don’t get me wrong, I love them.

The second part of this is seeing the action in the stock’s chart.

Take a look at INND.

On a regular day, the stock sees practically no volume.

The day of the press release, you see a spike in volume and shares start to move higher.

The next day, you get this headline…

“CEO Presenting on the Emerging Growth Conference on June 8 Register Now”

That’s about as far from material information as it gets.

And yet, that’s the day you get a boost in shares that send it skyrocketing.

Right now, I’m taking advantage of stocks like these by stepping in when the promoters do.

You’ll see morning panics, where shares dip under selling pressure.

In the case of INND, it happened later in the day.

I used a combination of price action and support levels to find my entries and then used hype buying to exit my trades.

For example, the first trade came in several candles after that big red one with heavy volume.

This caused a capitulation that created a temporary bottom that I bought into.

Those spikes back upward might not look like much, but they were worth plenty.

Final Thoughts

I see the same patterns play out over and over again with these stocks.

Promoters hype them up on whatever news they can grab, push shares higher, and ride the rocket.

It’s basically like GameStop Corp. (NYSE: GME) but on a smaller scale and without any short sellers.

Now, what I’m really hoping is that we start to see more of these lead to Supernovas.

Those patterns create incredible setups that I can’t wait to find.

Make sure you know what to look for.

Click here to learn more about my Supernova patterns.



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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 (888) 878-3621 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”