The local market has been lackluster in comparison to the other Asian markets, yet opportunities exist every day. The concept of the Bottom-Up Approach enables us to zero-in on names that could move inversely with the $PSEi. Hence, the index does not discourage you from trading potential leaders.
For our featured trader for the week, we will be showing how he was able bottom-pick MerryMart Consumer Corp. or $MM. Tsupitero TIBATIBA a.k.a. @jamesgranda, is an active member of the Investa Community who continuously spreads his knowledge, insights, and expertise in the local market. He used a modest yet powerful way to trade, merely using lines to determine critical Support and Resistance Levels.
As seen in his posts, he simply used psychological levels to determine the Support level, which was the 2-peso area. It is a low-risk, high-reward trade, as the downside could be a cut below 1.9-1.95 (-3% to -6%) and potential take profit areas at 2.5-2.7 (25% to 35%) based on the overall structure of the said stock.
Another highlight of this trade is that there is a bullish divergence using the RSI (14) indicator in the 30-minute timeframe. Along with that, there was massive volume coming in the stock when it first started to bounce from the 2-peso area.
Besides the price behavior seen in the chart, he also stated several factors behind the trade idea, including the possibility of the business to reopen in August, and the 20 million bids at the close last Friday.
He followed up his trade idea with an updated chart showing a breakout of the short-term downtrend of $MM supported with heavy volume.
Being a professional trader does not translate to an individual who uses and is knowledgeable with advanced trading systems. Just like in any endeavor, an individual does not rely on what he knows, but rather how well he uses his system, whether it is something simple or complex.
Congratulations to those who were able to maximize the technical bounce of $MM. Lastly, kudos again to Tsupitero TIBATIBA for sharing his execution, your FREE InvestaPro 1-month access is on its way!
This week’s featured trader is no one other than one of the most active members of the community, Jet Toyco! If you guys have been with us since 2018, you would’ve remembered that Jet was one of our speakers during Uprising: The Trading Revolution 2018 event where he generously shared his entire trading journey with us. Since then, Jet has been continuously posting high-value content on both our social platform on Investagrams and the Investagrams Trading Community FB group.
If you’ve been following Jet for some time now on Investagrams(if you haven’t, you’re missing out) you would know that he posts content on a daily basis. Whether it’s about trading principles he learned from other great traders like Rayner Teo, practical advice he learned throughout his journey, and much more. Jet also does a weekly Q&A session open to everyone in the community where he answers questions in video format and posts it on our Facebook group: Investagrams Trading Community.
He is also very generous to share high value content he’s found on other platforms as well. Here he shares a very RARE video of one of Mark Douglas’, the father of trading psychology and author of Trading in the Zone, seminars a few years back. If you want to watch the videos, we highly suggest checking the post on Jet’s wall on Investagrams!
Jet also doesn’t only post about topics related to trading or investing in the financial markets. He is also a practitioner of proper handling of personal finances. In this post, he shares some practical advice so we can all achieve financial freedom. He reminds us to track our expenses/income, simply our lifestyle, have a budget plan, eliminate consumer debt, and the like. He reminds us to not start a business, or trading for that matter, to achieve financial literacy. But to start doing business or trading once we are financially literate.
We are all grateful for people in the community who take the initiative to share their learnings, insights, and experiences about the market and life to other trades. A community is only as strong as its members, without people like Jet, our community would not be complete.
The Investagrams Team would like to congratulate Jet Toyco for being our featured trader of the week by being a team player towards the community. You will receive FREE 1-month access to InvestaPRO!
Welcome to the second round of INVESTA PRO LEAGUE!
THE CHALLENGE JUST GOT BIGGER AND BETTER. ARE YOU READY?
As traders, to achieve consistent results we have to be able to commit to mastery. We must be willing to face challenges that will help in our growth in this craft. What better way to achieve continuous improvement than to hone your skills, test your strategies, and compete with fellow traders in this another round of one-month competition?
The Investa Pro League is open to ALL. The competition will run for ONE (1) MONTH from August 3, 2020 until August 28, 2020.
Winners and Prizes:
The top three (3) participants with the highest account value at the end of the trading round will be announced as the winners.
Each winner will receive a corresponding cash prize as follows:
A. You must have an Investagrams account. If you don’t have one yet, you can sign-up here for FREE.
B. Anyone can join the competition. Participants may register until August 2 (Sunday), before the competition officially begins on August 3 (Monday).
C. Registration comes along with a subscription of InvestaPro and InvestaPrime to help you have an edge on your trading game.
D. Complete your payment through Credit/Debit Card, Bank Deposit/Transfer, 7–Eleven (Coins.ph), M-Lhuillier, or Cebuana Lhuillier. You will be notified once your payment has been confirmed.
E. Validation of ID. From your Transaction Invoice, or when you click on “Investa Pro League 2020” competition room under the Virtual Trade tab in Investagrams, you will be led to an instructions page in order to validate your identity. If you haven’t uploaded your Proof of Identity yet, please do so, as this is a required step for all participants. Once approved, you will receive a notification and your Proof of Identity under Account Settings will already be marked as Completed. Access to the official competition room will be granted.
F. Important note: Only one (1) entry and account per person is allowed. If you have more than one (1) account to join the competition, you will be disqualified immediately.
2. Investa PRO League will be accessed through the Investagrams Virtual Trading Platform (https://www.investagrams.com/vTrade) and participants will start with Php 100,000.00 virtual money to trade.
3. Participants can only trade liquid and actively trading stocks (we have filtered out which stocks fit this criteria) and have taken out illiquid names that have wide spreads that can be easily abused. The whole stock list can be accessed once you are accepted into the competition. The tradable stock list can be changed.
4. Upon buying a stock, you can only sell it after 20 minutes. This will protect the competition against ‘rinse-and-repeat’ abuses on illiquid stocks that are not realistically in-line with real market mechanics.
5. To promote diversification, maximum exposure in a single stock can only be 1/3 or 33.33% of the portfolio. This requires the participant to buy at least 3 different stocks should they want to fully invest their portfolio. The system won’t allow you to allocate more than 33.33% in a single stock.
6. Buying and Selling Conditions. Participants now have two options when transacting. The first option is to transact using the current price of the stock and use market orders to buy and sell specific stocks at their real-time prices. The second option is to transact using our new LIMIT ORDERS. By using Limit Orders, you won’t need to watch the market the whole day in order to transact in the market.
Buy – You can buy the same stock multiple times within a day.
Sell – You can only sell the same stock two (2) times in a day. This will be strictly observed in order to avoid abuse. This includes selling in TRANCHES. Example: If you bought 1000 shares of $SMPH at 29 then sold 300 shares at 29.10, then you have only one (1) sell transaction left for $SMPH within the day.
7. Holding period for all stocks
We will be applying the twenty (20) minute time lock for taking profits to ALL STOCKS to avoid widespread and rinse-repeat trades. There are instances where specific names are simply bought due to the 2-2.5% widespread sold after 5 minutes once the stock has been ticked up.
There will be no timelock or restrictions when selling at a loss.
8. Revision of Tradable Stocks. Investagrams has the right to remove any stock from the list should it suddenly become too illiquid, abusable and/or delisted. Furthermore, Investagrams may also add new stocks on the tradable list as new stocks become more active and tradable in the market. All changes will be announced before implementation.
In such cases that a stock is to be removed, we will follow this process:
Investagrams shall notify all the participants via the Investagrams Platform before the market opens.
If you still have the stock in your portfolio, you can sell it at any point in time at your discretion.
9. Initial Public Offering (IPO). All upcoming IPOs that will happen while the Investa Pro League is on-going will be added on its SECOND (2nd) trading day.
10. For stocks that will be detected by our WIDE-SPREAD DETECTION SYSTEM (WSDS). The Wide-Spread Detection System’s main condition is that the first (1st) best bid and ask should never be more than 2% at any moment during open market session.
Fig 1. Real-time Market Depth / Orderbook showing the first (1st) best bid-ask data.
Example: $ATN (Refer to Fig. 1)
Given:
1st best bid = 1.11
1st best ask = 1.14
Formula:
X = (1st best ask – 1st best bid) / 1st best bid
Condition:
If X is greater than 2% then WSDS detects that the stock is wide-spread and can be abused.
Solution:
X = (1.14 – 1.11) / 1.11 = 0.02700 x 100% = 2.70%
Verdict:
Since X is greater than 2% then the stock is wide-spread as computed by the system.
The participant will be given a prompt that the detected stock is not tradable upon executing a buy or sell transaction.
The stock will again be tradable once the system detects that the spread of the 1st best bids/asks are below 2%.
11. On Trading Abuses.
Day trading opportunities on natural market moves are normal, but please take note that Investagrams will be on full-guard against participants that abuse illiquid opportunities. We want our winners to show real trading skills that are applicable in the PSE. Abuse of intraday spread trades will NOT BE TOLERATED. These rules are set to protect against the usual ‘rinse-and-repeat’ abuses that are mostly used in virtual trading competitions like this.
Any player that has more than 10% of their profits from rinse-and-repeat wide spread, illiquid and other abusive trades will be penalized or DISQUALIFIED depending on the severity of their offenses. We will be able to validate this through our data and algorithms that verify the historical transactions of each participant.
Any form of hacks, cheats, and abuses shall not be tolerated and will have corresponding repercussions. Suspicious behavior that may not be specified in the rules may also be flagged as ‘abusive’ trading behavior. Warning shall be sent after Investagrams has reviewed and confirmed that the actions are against the integrity of the competition. All trade records shall be verified and those who fail to follow the rules will be disqualified.
Participants will only be given ONE (1) warning, any participant who has constantly repeated any abusive trading behaviors (whether illiquid stocks, system abuses, loophole abuses) will instantly be DISQUALIFIED. Investagrams has the right to review any suspicious activity, and if the behavior is deemed inconsistent with real life trading then the said player shall be disqualified.
Questionable Transactions. Questionable transactions will be cross-checked through the buy and sell transaction time and the traded stock. Stocks that have more than 2% consistent gaps in the one (1) minute timeframe within the transaction period shall be deemed invalid and Investagrams has the right to deduct the profits from the said transactions. It is normal to trade natural intraday moves and gaps can really happen, but if a participant is constantly trading stocks that have gaps within one (1) minute timeframe and their profits from these kinds of scenarios make up more than 10% of their total profits, then he/she will be automatically disqualified.
Fig 2. Example 1 for one (1) minute time frame gaps with buy (green arrow) and sell (red arrow) transactions
Fig 3. Example 2 for one (1) min. time frame abusable 2% gaps
Fig 4. Example 3 for one (1) min. time frame abusable 2% gaps
Investagrams will warn the player that is proven to be constantly transacting with illiquid stocks with 2% one (1) minute gaps. Basically, any stock that has 2% spreads and do not really have a trend is included in this definition. After the first warning, any player that is proven to repeat this kind of behavior shall be disqualified.
12. Trading Halt. Stocks that are on a trading halt will not be tradable during the halt and will be tradable again during the announced lifting time.
13. Trading Hours: Weekdays from 9:30AM – 1:00PM (This is the current PH trading hours and will be changed once the enhance community quarantine is lifted. Meaning, you can’t trade during off-hours and on weekends.)
14. Participant rankings are constantly updated every 10-minutes and automatically ranked by Investagrams system according to net profit gain/loss.
15. At the end of the competition, the participants with the highest net profits will win. The top 1 to 3 participants shall be announced the official winners.
16. Modification and adding of rules. Investagrams has the right to modify the rules of the competition and add protective measures against any future abuses that may arise to ensure the integrity of the Investa Pro League. Announcements shall be made if there are any changes. Rest assured, we prioritize keeping the competition as FAIR as possible to all participants.
17. Ignorance of the rules is no excuse. All participants are expected to have read and understood the rules and mechanics of Investa Pro League. These are published for the participants’ information and protection. Ignorance of these rules and mechanics is not an acceptable excuse for violation.
18. Joining the Investa Pro League means that you agree with all the clauses mentioned above.
19. If you are part of the Top 3 winners, the FINAL DEADLINE to claim your cash prize is on SEPTEMBER 30, 2020. The cash prize will not be given anymore past this date.
For our featured trader of the week, we have chosen Secret Jockey a.k.a. @buhospamore for his/her efforts in engaging the community!
Often when you scroll through the posts in the Investagrams platform, it is common for most users to talk about their different stock picks as well as why they believe in them. Although these posts are able to provide information, it is often refreshing to see a user who talks about the principles and processes involved in trading.
Secret Jockey is one of these people as some of his posts are addressed to newcomers to the stock market.
In one of his posts, the terminologies used by veterans are listed down. Although these are only the basic terms used, newbies would most likely appreciate it as it can be confusing to follow the thoughts as well as conversations of traders in the platform without knowing what some of the terms used actually mean.
Another post, directed towards newcomers again, holds especially true in light of recent events. Ever since the bloodbath occurred where the $PSEi rapidly fell towards the 4,000 levels, there has been a sudden influx of interest in investing. We’re sure most of you traders out there have received a message or two from a friend or acquaintance asking for tips on how to invest in the market. As one of our missions is to increase the financial literacy of Filipinos, we implore non-investors to participate in the stock market. However, what we would like to encourage is responsible investing.
Investing and trading isn’t about just putting money in the markets and then calling it a day, just waiting for a profit. As mentioned by Secret Jockey, there is no easy money. The simplest way to put it is that investing is simple, but not easy. You don’t have to be scared of not being smart enough because the market doesn’t care about who you are; it cares about the conscious effort that you put into making sure that your capital is safely compounding itself.
As the saying goes, there is nothing worth it that doesn’t come with the price of effort and time. If you’re hesitating because you don’t know how to start, don’t fret! That’s why we’re here. You can head on over to the Investagrams platform and find various informative articles that tackle how to start investing (READ: How to Start Investing in the Philippine Stock Market).
Just head on over to the “Learn” tab on the upper right side of the webpage and enjoy the curated content that we update from time to time in order to help more people become comfortable with the stock market.
Although we have seen quite a few rallies these past few weeks, it can still be said that the equity markets aren’t out of the woods just yet. In just a snap, we could go back to a strong bear market that could easily wipe out gains and cut down the amount of opportunities available.
Whether you’re a novice or a veteran trader, this advice holds true: always try to sharpen the saw. Find your edge, or in layman’s terms your advantage, and make it as sharp as possible. Also, if the state of the market is not suitable for your edge, then don’t be afraid to sit out. You don’t have to be a genius that catches every move in order to be a good trader.
Warren Buffett, an icon in investing, likened stock trading/investing to baseball and said that “in this game, the market has to keep pitching, but you don’t have to swing. You can stand there with the bat on your shoulder until you get a fat pitch.”
Again, we would like to congratulate Secret Jockey for being our featured trader of the week by being a team player towards the community. You will receive FREE 1-month access to InvestaPRO!
For our featured forecaster of the week, we are showcasing a trader who was spot on with his trading last week. Sorbeterong Trader a.k.a. @gan21, an active member of the community who constantly shares his own views of the market, was able to forecast the upswing of Italpinas Development Corporation or $IDC. Let’s take a look at how he did it.
Although $IDC wasn’t in an uptrend like many of the other stocks that stole the spotlight, it’s range was big enough to provide a profit opportunity for those who did their homework. As a small-cap stock, the corrections of the blue chips and other bigger mid-cap stocks were signals that money could rotate here. There could be a variety of ways to trade this, but the one Sorbeterong Trader used and shared with the community is a momentum pause play in the intraday chart.
Trends exist within every timeframe. Thus, within bigger sideway trends, a smaller uptrend can be found within lower timeframes. In this $IDC trade, a momentary pause or consolidation could be the continuation pattern that one can use to trade the range. Despite having moved away from support, the upside was still good at 15% given that the range was wide. In addition, the use of intraday levels gave better control over the downside as a tighter stop could be used than simply using the support at the bottom of the range.
Kudos to Sorbeterong Trader for a good trade. As our featured forecaster of the week, you will receive FREE one-month InvestaPRO access!
Although our index (the $PSEi) has been consolidating in a tight range for the past couple of trading days, the prior surge has caused money to rotate the smaller strong issues in our market. Although outshined by the hype from $DITO and $MM, $PXP has been silent even though it has given traders a good profit opportunity.
Just like the previous technician that we featured, JollanReplan used a simple, yet powerful indicator to help time his trade: Support and Resistance.
Using simple S&R principles, it’s clear that $PXP was in a short-term uptrend as the stock was forming higher lows and higher highs. For newer traders who are still learning how to use support and resistance, it is often a sign of strength when prior resistance acts as new support. It signifies that there are people on the sidelines eagerly waiting for the stock to come back at either the price they sold if they were prior sellers or at a price that they might have missed if they were waiting for the breakout.
By using prior resistance as new support, entry could be found in this stock before it surged further. The profit target was simple as well. The main TP was set at the height of the channel. As of today, this level was actually easily taken out as $PXP broke out of the channel. An overall solid trade by our featured trader!
A common notion among many newer traders is that being a pro trader means having advanced systems and complicated charts. Although they can be a source of edge, a trader’s performance doesn’t rely entirely on how much he knows, but how well he uses the tools and knowledge available.
Simple but effective. Congrats, JollanReplan, for being our featured trader of the week and for a good $PXP trade. Your FREE one-month InvestaPRO access is on its way!
Cryptocurrency has brought excitement to some but confusion to many.
Given its relatively new status in the finance world, there are many questions surrounding it – How do I use it? Is it safe?
Many do not have a good grasp of what it is, and for good reason.
It definitely is a concept that is hard to wrap your head around, but look no further for answers; below, we try to break it down for you in the simplest way possible. Read on to find out more!
What is it?
In essence, cryptocurrency is a system utilised to make secure payments online. A key element that distinguishes it is that it does not utilise third parties: you can directly make payments from person-to-person, without having to pass by a governing body to verify the transaction. Cryptocurrency is safeguarded by encryption algorithms done by computers, and these same computers are the ones verifying each transaction done. Cryptocurrency as we know it first emerged in 2009 with the creation of Bitcoin. This form of digital currency was set apart because of its use of blockchain technologyThe use of this technology is a key element of cryptocurrency, as it ensures secure transactions whilst not having to pass by any third party.
To further understand blockchain, the word can be broken down into two parts: block, meaning “digital information”, and chain, meaning “stored in a public database”. When a transaction is made, it is stored into a block. That block contains three types of information: first, general information about the transaction such as the date it was conducted and the amount; second, who is participating in the transaction; and third, a unique code called a “hash” that is used to distinguish it from other blocks (like a barcode). A block is made up of thousands of transactions coming from many individuals. Each transaction made in a block is first verified by a network of computers. These computers solve complex mathematical problems, called “Proof of Work” to prove they have done the task. They are then rewarded with cryptocurrency – this process is called “mining”. An alternative way of validating transactions is “Proof of Stake” wherein miners can validate a block based on how much cryptocurrency he/she currently holds – the more money, the more mining power you have. This way is sometimes more preferred as Proof of Work requires huge amounts of power and energy to solve the problem.
Once transactions and blocks have been verified, they get added to the chain of previous blocks (hence the name “blockchain”), and the transaction information becomes publicly available. Individuals are secure, however, and remain semi-anonymous as information regarding who is participating is summed up to a digital signature. Users of cryptocurrency can connect their computers to this network of blockchain, which allows them to receive copies of the blockchain every time it is updated, working somewhat like a Facebook News Feed. With thousands of computers connected to the blockchain, hacking and manipulating information becomes nearly impossible – to do so, you would have to hack into every computer that has a copy of the chain. In the same way, this chain is built on trust: with no identifiable information on anyone adding to the chain or receiving copies of it, it raises the question of whether you can continually trust the information being added and the network of computers upholding it.
Pros and Cons of Cryptocurrency
On one hand, a cryptocurrency is a viable option for many because there is no central authority, be it a bank or government, that has control over the network. This means that no single body has access to your funds and personal information, protecting you from the risk of exploitation. It also makes fund transfer easier between parties as there is no third/external party involved. You transact with another individual directly without a body to double-check the transaction – this responsibility falls on computers. Without a third party, fund transfers also have more minimal processing fees, leading to lower costs overall.
However, it has also faced criticism due to the anonymity of its users, making it a breeding ground for illegal activities such as money laundering. Additionally, there is wariness with the system that upholds cryptocurrency. Because everything is digital and not stored on a central database, cryptocurrency balances can be wiped out in seconds due to the destruction of a hard drive, loss of access to your digital wallet, and more, with no way to retrieve that money. Backup copies do not exist in the world of cryptocurrency.
Types of Cryptocurrency
Below are the two most common cryptocurrencies used. There are many more emerging types, as this is a relatively new and exciting industry. The total value of all cryptocurrencies in existence is around $214B.
1. Bitcoin
The most popular and valuable cryptocurrency, Bitcoin was the first of its kind. Launched in 2009, it was described as a peer-to-peer electronic cash system. Bitcoin represents more than 68% of the total value of all cryptocurrencies.
2. Litecoin
Created with the intention of being the silver to Bitcoin’s gold, it operates very similarly to Bitcoin. However, it is able to generate blocks four times faster than Bitcoin, speeding up the transaction activity by an incredible amount.
3. Other known cryptocurrencies are Namecoin, Ethereum, and EOS.
Conclusion
Cryptocurrency is definitely an interesting commodity, and one to look into if you are into riskier investments. It is considered high-risk high-reward because its market value fluctuates wildly. Its value is based on supply-and-demand, and with it being relatively new, individuals get into a frenzy over it, but also more than always drop it just as quickly. As an example, in December of 2017 it was traded at $20,000; exactly a year later, its value dropped to $3,200 – a huge change in just a year. If you do plan on going into this currency, tread the waters lightly: do you research well, track market fluctuations, and keep a rational, level-headed attitude at all times.
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