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Shortsqueeze

GME - Squeeeeeeeeze of the Century? What a fantastic time to be an investor! This parabolic run will go down into the history books & consequently the move isn't even over yet... I just wanted to outline the textbook bull breakouts since August. Purely based on price action this was a thing of beauty and was built up for months. The consolidation box was the final failed attempt by Wall Street to leverage their shorts. This event will create a major catalyst into new platforms & *hint: Decentralization. Good luck to all & long live retail!
NYSE:GMELong
by LibraTradesNY
2
CDR Short Squeeze Failure?This is an update to: www.tradingview.com As noted before we lacked upward movement that could end 2nd elliott wave in a statistically popular fibo retracement level. As short squeeze against Mevlin Capital inspired detail investors we have reached a popular level of 61.8%. It seems that memes have lost their momentum for buying stocks like GME or AMC according to what can be seen on the charts I assume the same will happen CDR. Just as writing this possibly S&P500 and NDX stocks are starting to loose upward momentum for the day tomorrow might be a crucial day for CDR. Reaching MA200 cannot come unnoted. New Fundamentals (previous are still in effect): Polish WIG20 index which CDR is part of has reached a significant barrier where bears can return. New Speculation (previous are still in effect): Short squeeze against Melin Capital (still shorting CDR but at significantly lower level) is loosing momentum as panic movements can be observed both on GME and AMC.
GPW:CDRShort
by deejayzajac
7
Zero Commission trading: GME, AMC & others get blocked and crashPrice is crashing on low volume for GME & AMC. TD Ameritrade restricted operations on GME, AMC & other securities Robinhood removed GameStop, AMC, Blackberry, Nokia and others Interactive Brokers has put AMC, BB, EXPR, GME, and KOSS option trading into liquidation Charles Schwab raised the margin requirement to trade GME (blocking small accounts from buying it) Those brokers cover most of the US retail market, and it is possible more have enacted restrictions "Robinhood". "Take from the rich to give to the poor". Here it's rather take from the poor so the rich can crash the price and exit. Melvin Confirms $2.75 Billion Investment from Citadel and Point72 Following Losses, Including GameStop (GME) Short I heard but could not confirm Citadel were short on some of those securities Citadel is Robinhood major client that buys their client order flow So this is how it is: They make money by taking the opposite side of retail, and when they lose they ask their zero-commission pets to stop their clients from buying This is from CNBC: “This is a big problem of the e-brokers’ own making as they are so beholden to their payment for order flow overlords and shows the real fragility of the zero commission business model,” said Timothy Welsh, founder and CEO of wealth management consulting firm Nexus Strategy. And world famous AOC criticized the brokers actions, she is a member of the Financial Services Committee and would support a hearing. A few days ago senator Elizabeth Warren said something had to be done, I believe she meant bail out her billionaire buddies. As you may know there is a divide in the US democrat party, between socialists (incl AOC) and "typical" dems. This will get politicized, and your portfolio returns will depend directly on US politics. Also, if these plays continue to be possible will depend on US congress and NOT on magical indicators. The left in the US (the people around Bernie Sanders) will likely fight in favor of the small guy, republicans and old school democrats will defend "systemic risk" in other words the big funds, libertarians (a few republicans + Tulsi Gabbard I'd say) might defend retail investors. But I really expect the same old dems & republicans to win and stop the infinite free money hack, a lot of people really won't like it, and it adds another brick to the wall of divide+tensions+radicalisation. Billionaires will get bailed out, but since they burned themselves I think they are going to calm down with the shorting and fear mongering. Unless crazy laws that overwhelmingly favor them get voted, at that point this would not even surprise me... For once the little guys won and beat the corrupt insiders, and so they cheated to avoid losing.
NYSE:AMC
by MrRenev
12
Just in: WHO reports EXPR is bullish on account of a BATEXPR round 2. They can shut down the accounts but they cant stop the perfect pattern. It will play out how it will play out. Good luck holders. The Bullish Bat: Bats are five point chart patterns that can point towards either a bullish or bearish breakout.One thing to note is that both bat types can be either reversal or breakout patterns. Look for a bullish bat in a bear trend as an indicator of a possible bullish reversal. For a valid bat, B should retrace between 38% and 50% of the first move from X to A. Here we have it!
ELong
by Verum0
11
Short squeeze mini series #18What Is a Short Squeeze? A short squeeze occurs when a stock or other asset jumps sharply higher, forcing traders who had bet that its price would fall, to buy it in order to forestall even greater losses. Their scramble to buy only adds to the upward pressure on the stock's price KEY TAKEAWAYS *A short squeeze accelerates a stock's price rise as short-sellers bail out to cut their losses. *Contrarian investors try to anticipate a short squeeze and buy stocks that demonstrate a strong short interest. *Both short-sellers and contrarians are making risky moves. A wise investor has additional reasons for shorting or buying that stock. AMEX:APT
AMEX:APT
by samitrading
2
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.
Editors' picks
NYSE:GMEEducation
by ChristopherCarrollSmith
329
Short squeeze mini series # 17What Is a Short Squeeze? A short squeeze occurs when a stock or other asset jumps sharply higher, forcing traders who had bet that its price would fall, to buy it in order to forestall even greater losses. Their scramble to buy only adds to the upward pressure on the stock's price KEY TAKEAWAYS *A short squeeze accelerates a stock's price rise as short-sellers bail out to cut their losses. *Contrarian investors try to anticipate a short squeeze and buy stocks that demonstrate a strong short interest. *Both short-sellers and contrarians are making risky moves. A wise investor has additional reasons for shorting or buying that stock.
NASDAQ:AKTS
by samitrading
GameStop $440 in premarket GameStop GME, the video-game retailer that is closing shops because of Covid and became famous now with it's association with the Reddit message board-fueled retail attack on institutional short sellers has just touched $440 in premarket trade. The loss-making retailer was priced at around $19 heading a few weeks ago and $60 last week before storming higher. GameStop has become the poster child for the 2021 stock market and its incredible volatility and speculation. The stock has gained 1,700% in January, causing pain to short-sellers. A trade like none we have seen before. The huge moves in GameStop (GME) stock have been, very clearly, the result of a short squeeze. A squeeze is a phenomenon that can occur after big gains happen in a stock that, in turn, cause mounting losses for short sellers who are forced to cover their positions. Even Investopedia had to rewrite their short squeeze articles. WHAT'S NEXT? People hunting for the next Short-squeezes will be a new hobby to many. Especially young traders, normally those who are currently on Instgram and Telegram groups about cryptos. What I would also expect is the SEC coming out with some new circulars. ps. I heard about this on Youtube but for sure there will be a film about all this in a few years. Title ' The Big Squeeze' 🙈
NYSE:GME
by FX_Professor
5
Timeframe selection is important to trade short squeeze!Timeframe selection is important to trade short squeeze! What happens in a short squeeze, the short-sellers are under pressure because they are under distress trying to cover their short positions. Along with bargain hunters and active traders wanting to make a profit from the short squeeze, all that combined actions pushes the price even higher. Time is money! Short traders try to trade carefully and fast. Short traders know that they have to act quickly otherwise the next higher price will be more expensive to cover their short position. However, short traders have to cover their short positions fast but don't want to cover the stocks too fast because that will move the price even faster and that puts short sellers at a disadvantage. Short sellers become long traders once they completely cover their short shares. Time frame selection is crucial when making a decision to go long or short. When trading a short squeeze, the weekly chart doesn't give the active traders good information. In fact, the weekly chart is useless to active traders because it doesn't provide any information. Active traders wanting to participate in short squeeze should consider looking at the 15-minutes chart or the 1-minute chart to make their decision to go long or to go short. With the weekly chart, it is impossible to decide the entry or exit price. Thank you for reading! Greenfield This is article #3 on how to trade short squeeze. Remember to click "Like" and "Follow!" to see more articles on how to trade short squeeze. Disclosure: Article written by Greenfield. A market idea by Greenfield Analysis LLC for educational material only.
NYSE:GMEEducation
by GreenfieldAnalysis
4
The end of an eraFor years short sellers had their fun. They do fundamental research, short, and then let everyone know. They don't hold back on fear mongering. And this worked for years. But nothing works forever. The US are entering bubble area and money is being thrown at stocks left & right. Massive & highly advertised short positions lead to short squeezes, and it is happening more frequently. It had to backfire eventually. The price of GME rallied after the WSB forums decided to aggressively buy if you didn't know. Laws on market manipulation are not very clear, what WSB did might get considered illegal or it might not. Regulators might try coming up with something against it, or maybe not since they only act when price went down, if price went up (legally or not) they never care. As everything else this won't work forever, regulators or not, I would be surprised it worked more than a few times. I am seeing people say "learn a lesson that you should never short anything", that's a pretty "dumb money" thing to say. What I would get out of this is don't ever get complacent, and avoid something if too many people are doing it/know about it. GME short interest was over 100% and they screamed on roofs they were all in short. Really asking for it... It's always fun to try and catch the market peak and with all the taxi drivers giving people stock tips it might not be very far, but there are a lot of variables, and I do not think it will be obvious (maybe it will). Maybe cautious Wall Street guys will give up and just end up going all in with leverage. I could not tell if the top is months away or years away, maybe it goes back and forth with a China culture war to replace the trade war fluctuations. We might not get a clean top and crash at all, but rather something really choppy and bad, or the price could keep going up like the Venezuela, Argentina, and Zimbabwe stock markets. Crash while going up. A possible good play some might want to consider is to short the more bad companies (that are not crowded, nice and under the radar), and buy the better ones. When the crash comes these shorts would cover losses. Forex has been quite a choppy unpredictable mess for me for the past 3 months, maybe everyone is too busy getting into crypto & stocks? Follow the money. Follow the whale. The casual retail millenial whale. Until they run out of money. I don't think we are at max euphoria yet, but it can't be very far.
NYSE:GME
by MrRenev
9
How far can AMC go?Kicking myself a bit for not picking up NYSE:AMC on Friday following my own potential short squeeze research. AMC along with many others definitely showed up in the stocks with the highest float short. But... "a stock is never too high to buy". If you zoom out the chart it's clear that AMC is just now starting its proper Daily Ichimoku breakout. There are clear price inflection points at $10 and then $20. With the crazy meme momentum going on this week anything is possible!
NYSE:AMCLong
by norok
12
Should I Buy GME Stock Right Now?I’m Markus Heitkoetter and I’ve been an active trader for over 20 years. I often see people who start trading and expect their accounts to explode, based on promises and hype they see in ads and e-mails. They start trading and realize it doesn’t work this way. The purpose of these articles is to show you the trading strategies and tools that I personally use to trade my own account so that you can grow your own account systematically. Real money…real trades. Let’s talk about GameStop GME because the stock’s gone absolutely crazy. I mean, yesterday, January 25th, it was up 144% before swinging into negative territory. Then it reversed again and closed up more than 18%. And today, it’s up another 22% to trade at $93.50. One month ago, it was trading around $20! So, today, I want to look at exactly what’s happening with GME, and let you know if it looks like a good time to buy the stock. What is Happening with GME? GME made its first big move in mid-January after adding Ryan Cohen to its board. This guy is the co-founder and former CEO of Chewy CHWY — the online pet supplies store — so he knows a lot about retail. The stock jumped from $20 to above $40 when that news hit, and this caught a lot of short-sellers off-guard. In fact, according to one CNBC article I read, GME is the most heavily shorted U.S. stock. The article states, “GameStop has been a popular short target on Wall Street. In fact, more than 138% of its float shares had been borrowed and sold short, the single most shorted name in the U.S. stock market.” What’s a Short Squeeze? For those that don’t know, short interest is when a trader bets against the stock, meaning they want it to go lower. To do this, they’ll borrow shares from their broker at one price. If the stock price falls, they can buy the shares back at a lower price to repay their broker and keep the difference as profit. But if the stock rallies, short sellers will have to buy back the shares at a higher price to limit losses. For stocks that are heavily shorted, this can create a sort of ripple effect: Because how do you close a “short trade”? Well, you SOLD the stock earlier so now you have to BUY it back. So when more shorts start covering, i.e. BUYING, the stock climbs higher and higher. This is the short squeeze. And in GME’s situation, as the stock rallied on good fundamental news, shorts started to cover. Then the Reddit crowd got involved. There’s a forum on Reddit called “WallStreetBets”, and their purpose is to, “make money and being amused while doing it.” Their words, not mine. As GME was rallying, online traders on Reddit began posting about the stock and buying it to manipulate the shorts. And as they bought the stock, the price soared, forcing more shorts to cover their positions, and again: This means that more people are BUYING. It’s not surprising there are a lot of traders upset about this manipulation. Famous short-seller Citron Research is one of them and said it would no longer comment on GME because of the “angry mob” on Reddit. Is GME a Buy or a Sell? Now, you could make an argument for GME stock to keep going higher. There are probably some shorts still hanging on. And fundamentally, the company did report solid holiday same-store sales and digital sales growth a few weeks back. But in reality, it’s dangerous to trade GME right now. For starters, look how overbought this stock is. And a lot of times, when these stocks fall, they fall fast. Remember Eastman Kodak KODK last summer when it went from $2 to $60 in two days. And then back down to $6 a month later. And implied volatility is all over the place. This means options premiums are crazy high right now for options buyers. But it’s not a good time to sell options, either, because it’s hard to pinpoint levels of support or resistance. So, yes, you could have made a lot of money trying to trade GME stock, but you could’ve lost a lot of money, too. And whenever I see a parabolic move as we’ve seen in GME , I leave it alone. The risk is simply not worth it. Because at some point, the Reddit traders might lose interest in this stock. So they would just sell it and move on to the next stock, and that could make the stock crash. After all, there are 2.3MM people in this group! More Stocks to Watch Before we go, I just want to check out some more of these “short squeeze” stocks that have been volatile this week. The first is Palantir PLTR , which ran from $26 to almost $40 in two days. Today, the stock is down 3% at $35.12. Another is BlackBerry BB . BB stock ran from $7.50 in mid-January to above $20 yesterday — its highest level since 2011. Today, the stock is up 3.6% at $18.60. And here’s Bed Bath & Beyond BBBY , which was trading around $18 earlier this month, but hit a three-year high near $48 yesterday. Today, BBBY is up 0.1% at $30.68. Finally, there’s AMC AMC . It was trading below $2 at the start of the month and hit a high of $5.19 earlier today. While I’m not going to be trading these stocks because of the risk involved, I’ll certainly be keeping my eye on them.
NYSE:GME
by rockwelltrading
4