The term pump-and-dump is usually associated with penny stocks, but rest assured, these scenarios unfold in the world of big board stocks too.
Understanding this concept is critical for two simple reasons. First, by avoiding them you are going to save money. Pretty straight forward. Second, if you love to short stocks like I do, these technical chart set-ups can be very profitable.
In this video I describe a “real life” pump-and-dump that occurred on this big board stock. The beautiful thing here is none of this is being talked about in hindsight (those are the worst kinds of examples!). As you will see, I alerted the pump-and-dump to my private trading group chat room BEFORE the crash happened.
Be careful out there. The stock market is a dangerous place and there are traps all over the place.