Kristjan Kullamägi (Qullamaggie): Stream 11 - Stream 15 [Oct 2019] - Notes
Over the months I have gone through every stream that Kristjan Kullamägi (@Qullamaggie), a prolific momentum swing trader, has ever posted. Below I have categorized my notes into topics relating to his streams.
For reference, the chart below shows the overall market KK was trading in, at the time of the stream:
Stream #11: “Markets finally out of range. Follow through? Oct 17, 2019”
Market Sentiment:
Things can happen in cycles, microcap momentum happens in cycles, can be dead for months and months, and then just suddenly wake up.
If the market wants to go higher it’s going to go higher no matter what, every bull run there’s a lot of doubt, since trading in 2011, a lot of people have been so bearish for years and years and still the markets going higher, I follow price action, you can’t listen to people’s opinions most of the time they’re worthless. The only thing you have to listen to is the price action.
Breakout Setups:
Referring to XBIO 0.00%↑; these patterns happen on all time frames, daily, intraday, weekly, these flag patterns are very powerful. The more powerful the first leg higher is, the more powerful the next leg higher is going to be most of the time.
For faster-moving stocks, you should just be using the 10 or 20day SMA for exit points as, when it hits the 50-day SMA, it’s probably gonna be down 50% from the highs.
Stream #12: 2019-10-18_16-13-27. Oct 18, 2019”
Swing Trading Wisdom:
Ultra-thin names are so easily influenced by chat rooms so you can’t trust the volume, when the volume comes in that could be the top, but many times it is, kinda hard to trade them.
Multi-year trend lines matter they’re significant!
You want to trade high-beta stocks!
Breakout Setups:
Stocks that go big on the first leg, the bigger the second leg. You want the strongest names, and sometimes it’s the stocks that have gone up the most that are gonna keep going up the most.
Beaten Down Stocks:
Stocks that get super beaten down, people think they’re gonna go bankrupt then when evidence comes out that they’re not gonna go bankrupt they can have huge runs.
Beaten down stocks, people think they’re gonna go bankrupt but sometimes when they catch momentum they 2/3/4x in no time, and sometimes move even more explosively than the best growth stocks, this is why you need to always stalk stocks, you don’t even need to know the fundamentals you just need see the trend, I know the fundamentals are sh*t I can see from the chart.
Long Side Setups - Entry / Exits:
I always sell some into strength, then I trail the rest. The first close below the 10-day, I sell 1/3 or 1/4. Then when the price closes below the 20-day I sell another 1/3 or 1/4. Then when the price closes below the 50-day, I’ll sell the last shares, but sometimes I make an exception if it has put in Higher Lows.
Stream #13: Finally getting some traction in the protfolio! Oct 21, 2019”
Episodic Pivot (EP) Setup:
Main things to look for in EPs, are when you have longer-term charts, when you have a stock that’s been going up for multiple years then going sideways for a long time, (ie. MELI 0.00%↑ - Feb 2019) then it had a big beat, decent growth rate and big estimates, had a big earnings gap up above a range, you can find good R/R trades in these things.
A stock that’s been in a long-term up trend, has been going sideways for a while 6-12 months or more, then they break out on big volume, earnings beat, and nice growth. These things you can trade for the longer term and trail the stop.
You only need like 1-2hrs per day. Maybe an hour before open, and then about 30-60mins after the market has opened to trade these things because most of the time you find them after hours (AH), or pre-market (PM). Especially the mid to large caps because they usually have a lot of volume in AH and PM . You scan for stocks gapping up on volume AH and PM, then look at growth, analyst beat and a nice-looking chart. All you need is to find 1-3 per earnings season that you trade well and that’s gonna pay for so many losers. Usually does 10-20% of capital into good earnings trades but could do more or less, it’s all about what you’re comfortable with and how confident you are in the setup.
Biotechs:
For biotech news, has a hard time having conviction on those things, Usually has a better conviction on earnings.
Stream #14: “Swing trades starting to work again! Oct 22, 2019”
Historical Market Structure:
If you go back a hundred years usually most of the market gains are from between Oct-May, and between May-Sep the markets generally haven’t had gains, in most years.
Large Caps:
In a normal scenario if you can find a large-cap stock that goes up 40% in a year, that’s a big move, but overnight that’s just crazy for a large-cap stock to do something like that.
Stream #15: “Swing trades starting to work again! Oct 23, 2019”
Patience:
It’s all just a waiting game, trail your stops, cover into weakness, it’s just a very simple method I trade nothing complicated, the hardest part is the patience part, it gets really really boring.
EP Setups:
Looking for explosive earnings, big surprises, big numbers, coming out of big bases on big volume, that’s pretty much it, there’s usually a few per earnings season, some more some less.
Large Caps:
Referring to BIIB 0.00%↑; when a large-cap stock gaps up 30-40% overnight, most of the time they can’t hold it, such a big move, usually stocks like these move 30-40% in a year not overnight.
Index:
Stream 11 - 15 [Oct 2019] - Notes