, 11 tweets, 2 min read Read on Twitter
Going through my usual weekend routine (cleaning up the inbox/catching up on DMs etc.) & almost every question this week is on the same topic (fundamentals & faders), so im going to post a thread to answer this again. Grab some cofee & let's begin. Get ready to have feelings hurt
Recently, as most have already noticed, people have been going around teaching absolute GARBAGE about fundamentals & filings. Teaching things that are 100% flat out WRONG. Sure enough, newer traders who dont know any better & trusted these ppl, blindly followed, and got WRECKED.
Which is why I get so enraged when ppl who have NO CLUE what they're talking about, try to TEACH, instead of LEARNING first. Everyone wants to be a teacher these days even when they're NOT ready, without even realizing that their mistakes are costing people MONEY and BLOWUPS.
No, a shelf is NOT an instant ATM that can be dumped at anytime.
No, an EFFECT doesnt mean it's TIED to the most recent S3 u carelessly skimmed.
No, just b/c a company has warrants at $3 doesnt mean they can just use em.
No, just b/c a company has an ATM doesnt mean its relevant
Yet, ppl are being taught this trash, and when they lose $$, they try to blame fundamentals. Just b/c everyone has access to filings doesnt mean everyone is USING THEM CORRECTLY. that's like saying "everyone has access to charts & technical analysis so price action doesnt work".
Fundamentals must be used CORRECTLY. just like Technicals must be used CORRECTLY. If a stock drops to support and DOESNT bounce, does that mean Technicals no longer work? Yet when a stock with so called "dilution" upticks 3 cents, everyone panics OH MY GOD FUNDAMENTALS DONT WORK.
Do u see the flaw in that logic? There is ZERO competition b/w fundamentals & technicals. one is not better than the other, b/c they serve 2 COMPLETELY diff purposes. One lays the ground work for the thesis, & AMPLIFIES the technical setup. The other is for CONFIRMATION & TIMING.
When the 2 are in agreement, the price move is amplified. when they are not, u get CHOPPY action/the reverse. An examp of this is when ppl see a 5M ATM (supply) & rejoice. "yay it's gonna fade". Yet they COMPLETELY ignore the 50M volume(demand). That is NOT a supply imbalance!!
Or when ppl see a huge supply overhang (warrants/converts etc), & think "YES, THERE IS DILUTION. max BP baby lets go". yet they ignore the part that says that those CANT be exercised yet, have a lockup period, or are part of a PIPE that's not even registered yet. The list goes on
Conclusion, anything used WRONG will backfire. Dont blame the car,blame the driver. On in today's "everyone is a teacher" bubble, blame the driving instructor. Trading is SERIOUS. this shit takes WORK. u're not gonna half ass it & expect great results. KNOW who u're learning from
and i dont wanna hear that "no one is teaching it" BS. There are a TON of LEGIT ppl teaching this shit out there, in vids, books, articles, DMs etc. most are just not looking hard enough b/c they're attracted to marketing crap like shiny PNLs & fancy cars. FILTER the noise. GL..
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