Upgrades and Downgrades Don’t Matter

Hey there, VWAPians!

My Warlock’s World community and I had an incredible trading day yesterday during my live stream.

I was able to zero in on trading opportunities in some crazy names like Amc (AMC), Tilray (TLRY), Robinhood Markets (HOOD), and Vinco Ventures (BBIG) to name a few.

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But it was the recent price action in Beyond Meat (BYND) that had me all fired up.

And I wasn’t even trading it.

Fake meat? Blecch. Not for me.

A member of my Warlock’s World asked in the chat why BYND was trading higher after analysts had downgraded the stock.

I’ll tell you why – manipulation.

It’s all a game of “market makers” having a position that goes against them, so they upgrade or downgrade the stock to change the sentiment of retail traders.

Then they go the other way.

Market makers use upgrades and downgrades, and the CNBCs and Fox Business’ of the world to perpetuate FRAUD.

I know this because of my experience in the industry.

All of this became apparent to me when traders began to get access to Level 2 data.

Level 2 data is essentially the order book for stocks, including bid/ask prices, and shows buying and selling sizes that can be incredibly useful.

I usually have a box of level 2 data running on screen in my Warlock’s World for certain stocks at any given time.

An expanded look at the Level 2 data for AMC on Tuesday

In today’s level 2 data, institutional traders – the Goldman Sachses of the world – hide behind ECNs (electronic communication networks) and dark pools.

But back in the day, you used to be able to see EXACTLY who was on the bid or offer at any given time.

Instead of being able to hide behind the curtain of the random letters in the level 2 data, it used to just say “Goldman” on their orders.

And I noticed a horrifying trend.

Goldman Sachs would come out and downgrade a stock. So they’re saying it should be going down.

One would expect to see Goldman on the offer all day, scaling out of their position, right?

Wrong.

What I started to notice was every time these market makers would make these announcements, I would see them on the opposite side of their own calls.

They’d make a downgrade and be sitting on the bid all day.

And I kept seeing it over and over and over again.

It was so consistent, that it made sense to start joining into the move.

What I want you to take away from this is that upgrades and downgrades don’t matter.

Upgrades are meant to be sold into. Downgrades are meant to be bought into.

Because they’re fraudulent, manipulative tools by the market makers and the brokers to try to steal your money.

That’s one of the reasons why I don’t own stocks anymore.

I’m done getting caught by the frauds that manipulate the market all day.

That’s why I only “rent” stocks now, riding the institutional wave and bailing out to live to trade another day.

That’s why it’s so important to join my Warlock’s World.

I have the knowledge, experience, and the tools that can help keep traders safe in ANY market environment.

Those tools are VWAP and ME.

And the best way to take full advantage of these tools at your disposal is to join my Warlock’s World.

I hope to see you there soon.

Kenny “The Warlock” Glick

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