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Gammasqueeze

Options positioning in Tesla has flipped bearishLooking Back on Tesla's 2020 Bull Run Tesla is massively overvalued and has been for a long time. We're talking probably something from 20-100x fair value, to be honest. But Tesla has also continuously moved higher, for several reasons. First, institutions have been systematically gamma-squeezing the stock higher by buying out-of-the-money call options on it. (The story of the Tesla stock run is often told as a story of retail hype, but in fact most of the out-of-the-money call buys have been very large, and when you drill into the data, you find that Tesla is surprisingly not actually a favorite of small retail out-of-the-money call buyers.) Second, there used to be some fairly large short positions open on Tesla. The shorts have gotten squeezed as the stock moved higher and have almost all been forced to cover. Why the Bull Run May Be Over Over the last 30 days, Tesla's average put/call ratio was .67. Yesterday someone opened a very large out-of-the-money put position on Tesla, and today the put/call ratio is 1.3. That represents an extremely bearish shift in options interest, and it suggests that the call options gamma squeeze on Tesla is probably over. The puts are spread across a lot of expiration dates, so this is not just a short-term bet. Someone is banking on Tesla entering a long, slow correction from here. The short squeeze is over too. Short interest on Tesla is now super low, with just one day to cover. In terms of technicals, Tesla has been moving in a large parallel channel and is currently in the top half of the channel, with much more downside than upside. It made two lower highs in February.
NASDAQ:TSLAShort
by ChristopherCarrollSmith
20
Finally a support on $CLVSClovis seems to have found a way to raise prices ! The indicators show a bullish divergence on H1 and a chronic delay on the reversal of the trend according to the cycles of Hurst. The patterns of the candles confirm the will of inversion of the trend. If the ascent is confirmed and becomes impetuous with good odds we can see a short squeeze because the percentage of short positions is high and the title has a high delta. Disclaimer: I am not a financial advisor. This entire post represents my personal views and opinions, and should not be taken as financial advice (or advice of any kind whatsoever). I encourage you to do your own research, take anything I write with a grain of salt, and hold me accountable for any mistakes you may catch. Also, full disclosure, I am long CLVS via shares and a variety of options spanning multiple dates and strikes, and I'm using money I can absolutely lose. My capital at risk and tolerance for risk generally is likely substantially different than yours.
CLong
by MarketMiracleAdvisor
ALERT - ETH Ready To Explode Higher This WeekendETH reached ATH yesterday of $1699 and has seen a healthy retrace back down to the $1556 level. Now ETH is forming an inverse Head and Shoulders pattern, and getting ready to explode higher over the weekend to reach $2K, before the incoming CME launch on 2/8. Meanwhile, ETH is about to explode higher GME style, as a growing number of options traders are sitting on large unrealized losses following Ether’s (ETH) latest price surge. Pankaj Balani, CEO of Delta Exchange told Cointelegraph that he has observed “a lot of naked call writing activity in ETH for deep out of the money call options all the way up to $2,000 and $3,000 strikes.” A call option becomes deep out of the money if its strike price is significantly above the current price of an underlying asset — in this case, Ether. Balani said: “As price surges, short call options positions are resulting in heavy unrealized losses, forcing option writers to buy more ETH in order to cover their short gamma exposure.” Traders sold call options of strikes $2,000 and higher in December 2020 and January thinking Ether’s price would not appreciate as quickly and that their options would expire worthless. “There is a chance that those sold options will not expire worthless,” he said. As Ether moves higher, this scenario will only intensify, forcing additional buying activity. In the options market, this feedback loop is referred to as a “gamma squeeze.” ETH CREW: Let's converge and pull a GameStop-like gamma squeeze for ETH!!! Cheers! Source: cointelegraph.com
COINBASE:ETHUSDLong
by Kymatic
The Squeeze of the century (180% Target) GME WHO?I'm sure everyone is only reading this because you have heard of the #SilverSqueeze that's trending everywhere. If you are congrats. You're smart enough to know that investing in Miners is the smartest play of them all, which will most likely yield the greatest returns. I'm not going to give my full Investment thesis, because I don't feel like typing that much (Look at my other ideas I'm already breaking records with more than 1 sentence). So I will break down the whole #SilverSqueeze situation very simply So. Banks around the world manipulate silvers price by inflating the amount that exists artificially (Paper contracts) Because of this many Banks and institutions are massively short on silver. With the inflating of supply with these paper contracts (Let's call it fake silver), they aren't actually storing as much physical silver as they normally should be. Now to mess up the banks people are buying a bunch of physical silver (that banks don't have a lot of) to not only clear their vaults that are already low in volume already (The lowest in history) but to raise demand. Not only will this increase the price of silver, but it will also liquidate their massive short positions, thus causing a short squeeze sending us to the moon. Why AG? We are playing AG because it's a silver miner, and the demand for them will inevitably skyrocket when these banks/institutions will need more silver to meet the demand. Since #SilverSqueeze, AG has been the leader in the Silver sector gaining almost, 60%+ in the past couple of days. Also, it had the highest short interest in its history :) You know what that means? Thats right. Double squeeze, One when silver squeezes and one when AG squeezes. If you don't believe in my fundamental case, I don't care. Look at the chart. That's the most beautiful thing I've ever seen in my god damn life. Don't ask me to stand up while I'm looking at that beauty. Breaking decade long trend? On HISTORIC volume? After 5 year-long accumulation cycle of higher highs and lower highs? It's a wrap. Historic searches in Google trend imgur.com Outpacing any other 'short squeeze searches' imgur.com Top Silver miner CEO says they are running low on supply, hinting this could be a trigger twitter.com Top silver sites are already running low on the amount of Silver available in the market place twitter.com twitter.com Short interest on AG at all time high twitter.com Silver Supply is the lowest in a DECADE imgur.com I can honestly go on, but you get the point.... Buy the damn stock and wait for that 180% target.
NYSE:AGLong
by johnwright35879
2
How to profit from the next WallstreetBets Gamma SqueezePraise Wallstreetbets How to profit from the next gamma squeeze? Diversify into Stocks with strong short interest (Short Ratio) and watch WSB Discord + Reddit. Why? Because GME had about 120% short interest and after further investigation from WSB they found out that one of the major market participants who was shorting was Melvin Capital. What helps is to just ask yourself which garbage company everybody knows but nobody understands how they stay afloat.
NYSE:GME
by UnknownUnicorn5507594
#Blue (Bluebird Bio) Gene therapeutics #BLUE is a candidate I've been watching for weeks. Bluebird bio is bio tech company that develops therapeutics for genetic diseases and cancer treatment. I posted this one originally on the 19th. My personal target will be 113.47 but we could ultimately see $137-163 beyond that in time. First target id expect to see is 72.37 if it ends up playing out. The bullish gartley is the same harmonic i used to call #AMC a couple weeks back when it was under $3.00. This formation is one of the most powerful reversal patterns in trading and can be signs of an incoming gamma squeeze. I do believe this is the case here. #BLUE reached $235 back in 2018, and id assume was shorted all the way down to 86, and initially as shorts exited, rose once again to 162 where (presumably) it was shorted into the ground once again. When these shorts are once again exited and this formation is complete, you will see the power behind bullish harmonics and a short squeeze YEARS in the making. Nothing is guaranteed in this market, and the S&P dropping won't help, but Im slowly adding to a position. This way if the price falls, I can average my way down until it reverses. This is generally my strategy with any asset. This is in no way advice, and I could be wrong (I know, it's hard to believe) but its one to keep an eye on, and one im taking a chance on personally.
NASDAQ:BLUELong
by TradingNomadic
Retail Investors HELD THE LINE 1/29/21 Gamma Squeeze GMEWe are making History here! Big Hedge Funds have shorted this company beyond the number of shares even available! When we called them on it they tried every trick in the book and when that failed they threw the book away and shut down the game! They tried to shut down our communications. They tried to discredit us. They tried to spread misinformation. They tried to cause panic selling. When that didnt work they even stopped us from buying publicly traded stock on retail platforms! But not only did we hold for every dip caused by more shady practices we bought the dip. Volume is critically low. They have nowhere to go and mountains of debt that is increasing exponentially! We have won the battle today and now the war has begun! Here is my analysis for GME for the coming week. We have a huge Short Squeeze we are about to enter. Not financial advice. I'm not a professional. Just a regular rocket scientist that likes this stock. I like it A LOT!!!
NYSE:GMELong
by carrering_official
4
Short squeezes, gamma squeezes, and the GameStop dramaIntroduction Video game retailer GameStop is up nearly 800% in the last two weeks. The story of how this happened makes for both an entertaining soap opera and an educational example of some market-making forces every trader should be aware of: short squeezes and gamma squeezes. Buckle in to learn how reddit vigilantes took on activist short-sellers and caused a massive spike in a struggling retail stock. Act 1: The Citron short The story begins with a brief video released by activist short-seller firm Citron Research in which Citron's Andrew Left announced a short position in the stock. The video wasn't really up to Citron's usual standards. Usually they expose some kind of fraud when they take a short position, but this time the argument was that GameStop was a low-quality company in a doomed brick-and-mortar retail sector and is not going to be able to turn itself around. Here let me pause to define some terms: "Short-sellers" are traders who borrow shares of a stock, sell the borrowed shares at current market price, and then buy the shares back later in order to return them to the lender. If the stock goes down between the sale and the purchase, the short-seller pockets the difference as profit. If the stock goes up, the short-seller takes a loss. "Activist" short-sellers are a special category of short-sellers who do research in order to find poorly managed or fraudulent companies, take a short position on them, and then release their findings to the public in the hope that the release of negative information will drive the stock price down. Act 2: The Wall Street Bets squeeze Activist short-sellers have played a role in exposing nearly every major corporate fraud that's ever been taken down. In my opinion they perform an important market function and offer an important service to investors. But a lot of people hate activist short-sellers. They're often accused of releasing false or misleading information in order to manipulate a stock, and plenty of critics also feel that short-sellers are unpatriotic, pessimistic, and destructive. If you watched The Big Short and hated all the main characters because they were trying to destroy the banks and betting against the American economy, you'd probably also hate Citron Research. That's how the folks on a subreddit called "Wall Street Bets" feel about Citron. Activist short-sellers often get hacked, threatened, and bullied, but usually it's by agents of a fraudulent company they've targeted. (Invisibilia's episode "Trust Fall" documents a recent horrifying case involving the fraudulent mafia-connected German fintech company Wirecard.) The GameStop case is a little different because it was Internet vigilantes, and not corporate agents, who targeted the shorts. Left and other GameStop shorts came under an intense barrage of verbal assaults and cyberattacks from members of the Wall Street Bets subreddit who believe in GameStop's turnaround story. And that's not all the vigilantes did. They also coordinated a campaign to manipulate GameStop's price upward and "squeeze" the shorts out of their trade by buying lots of far out-of-the-money GameStop calls. This campaign has been tremendously successful, as evident from the stock's recent price action. Citron's Andrew Left posted a video on Twitter in which he announced that as a result of the backlash, he has exited his GameStop short trade. Here, again, let me pause to define some terms: The problem with short-selling is that your losses are potentially infinite. If you're short on a stock whose price price increases more than 100%, then you can lose more than 100% on your trade. If you don't have enough cash in your account to cover the loss, then this can trigger what's called a "margin call," where you're forced to buy shares in order to "cover" your short. And if your short position is large enough, there may not be enough shares for sale on the open market for you to quickly exit your trade, so it may take some time for you to cover. This can cause a dramatic increase in stock price, known as a "short squeeze." There's another kind of squeeze called a "gamma squeeze," which occurs when someone buys a lot of far-out-of-the-money call options on a stock. The sellers of far-out-of-the-money call options usually will buy shares of the stock in order to cover themselves in case the options eventually get exercised. That drives up the stock price. Plus, there are a lot of algorithms out there that buy or sell stocks based on what open options contracts imply about the market's expectations for a stock's future price. So buying out-of-the-money call options can also trigger those algorithms to buy, further driving up the price. In the last couple years, retail options traders, especially on the Wall Street Bets subreddit, have realized that they can manipulate stock prices by banding together to buy lots of out-of-the-money calls. This strategy has been successfully used for over a year to drive up the price of Tesla, and now it's being used on GameStop with similar impressive results. Conclusion The biggest moral of the story here may be, don't sell shares short. It's a dangerous environment for short-sellers, with gangs of vigilante longs roaming the social media streets. The GameStop and Tesla stories prove that retail traders, if they band together, have the power to be market makers and to take on institutions. It also proves that markets aren't necessarily efficient or rational. Sometimes they are a battleground for differences of ideology or social class, and the underlying company fundamentals matter not at all. Of course, this likely won't go on forever. Using a gamma squeeze to manipulate a stock price is arguably illegal, so there's a possibility that the SEC will eventually crack down. Gamma squeezes also require the existence of market makers willing to sell far out-of-the-money calls, and it's possible that that willingness will go away. If market makers stopped selling these calls on GameStop or Tesla, the game would quickly be up. And finally, I think we will see companies increasingly position themselves to take advantage of these situations. The ideal move for GameStop executives would be to issue a lot of new shares right now in order to harvest the manipulators' money and raise enough cash to cover the company's future losses. (Tesla has done this a few times in the last year or two.) And, as it turns out, GameStop has an offering ready to go, through a program they put in place on December 8. (Possibly they had advance notice of this coordinated Wall Street Bets program to manipulate the stock.) They only have to pull the trigger, which I assume they will do when they feel the stock has hit its peak. That is likely to trigger a sell-off in the stock, but it could also potentially stabilize the company's finances, stave off bankruptcy, and greatly extend GameStop's life. And that's another reason why fundamentals sometimes don't matter and why it's dangerous to be short on a stock: because to some extent, it's the stock price that drives a company's success rather than the other way around. A higher stock price allows a company to raise more capital, and more capital allows the company to invest in updating its business model and turning things around. Perhaps we will see this run in GameStop's stock price lead to large capital expenditures, a new business nodel, and a total revitalization of the company. Only time will tell.
NYSE:GMEEducation
by ChristopherCarrollSmith
329