It's very hard to make everyone understand that squeezes are, by nature, a play on technicals. Especially with the number of new players in the market coming in on FOMO, and especially when they probably aren't looking to actually stay and play, they're just looking for the next lottery ticket. They don't understand fundamental vs technical, they don't understand longs vs shorts, they don't know what squeeze even is, and they probably don't and never will care; they just have the vague idea that "bro this one dude become a millionaire come on and get your piece of the pie!"

That said, the fucking MSM is carrying water for their hedgie buddies screeching about fundamentals. Like, no shit, we don't think the stonks are all fundamentally solid (though in my defense, I'm only playing GME, and I actually believe in the fundamentals and will see how Q4 looks and what Cohen can do with it, and at an average under 30/share I think I'm still below fair value)

Anyways long and short of it is, trading on technicals has never been against the rules, at least not on paper and certainly not for the hedgies. But God forbid, the retail investors finally wise up and do the same shit, suddenly they're "gaming the system" and "should be investigated for manipulation"

Like just fuck off dude

Obligatory I am not a financial adviser, i just like the stock and wanna see it 🚀🚀🚀🚀🚀🚀 to alpha centauri

I keep forgetting there's a bunch of rookies/newbies to the trading game who don't know how a bunch of this shit works.

Okay, quick and dirty explanation of call options:

A call option is a contract where a person who holds 100 shares (it's always a bundle of 100 shares per contract) sells the RIGHT to buy those shares at a specific "strike price" to the person who buys the contract itself. The person selling the contract (the originating shareholder) gets the initial contract premium, and if/when the contract is exercised (acted upon), the proceeds of selling those stocks still goes to the shareholder, and the contract exerciser gets the 100 shares.

The contract can furthermore be traded at any point before its expiration date, but it always is tied directly to shares held by the originator of the contract. Until and unless the contract is exercised, the shareholder has no control over the 100 shares (this is the important part that I was talking about in my initial reply). They can't sell them on their own if the price of the stock goes up, they are OBLIGATED to sell at the price the contract specifies if the contract is exercised.

Let's use GME, of course. I decide I, Person [A], as a GME shareholder with more than 100 shares, want to put 100 shares into a call contract for 100 bucks. I am selling the right for someone to FORCE me to sell them the stock at 50 bucks, regardless of the price the stock is when the contract is exercised. I sell the contract a year ago for an expiration of January 2023 for a contract fee of $0.05. That is to say, the person who first buys the contract from me is paying 5 cents, per stock, to have the right to buy the shares at 50 bucks per stock, the strike price, at some point in the future before the last Friday of January 2023.

So in order for the first contract buyer to break even, the price of GME would have to get to $50.05 -- enough for them to buy and then immediately sell the stock, with the 5 cent-per-stock premium, to normal market buyers. Since contracts are for 100 shares, they would need $5000 in their account ($50*100 shares) to "exercise" it and actually take possession of those 100 shares.

Options are typically traded by shareholders who believe the price is going to go down, or to provide a comfortable escape to lock in profit from a stock that's going up, but they're unsure of the top, while also getting the contract fee. Using the GME 50c example above, if GME is currently trading at $25, but looks set to go up within the next month, I might sell a contract that expires next month for a strike price of $50. Therefore, if the price HITS $50, it will either be exercised by the contract holder, giving me the money I would have gotten had I sold them myself, or they won't have the capital to actually exercise, in which case at the close of business on the date of expiration I get control of those shares back and I can sell them again.

If GME kept going to 60 at that point, my 50c is said to be "in-the-money". This means that whoever holds that contract can FORCE me to sell the 100 shares at 50 bucks, EVEN THOUGH it costs 60, allowing them to pick up the stock at a $10 discount per share and forcing me to sell $10 below what I could have gotten.

So, for the most part, call SELLERS want the stock to go DOWN, because their contracts will expire out of the money (strike price is above stock value), no one would exercise it when they can just buy 100 shares on the market itself for cheaper, AND I've pocketed the contract fee. I get my shares back, I keep the contract money, and the last person holding the contract gets nothing. Call BUYERS want the stock to go UP, because when it does, that means that they now can undercut the current market price, and their ability to buy it cheaper comes at my (the shareholder's) expense.

Now, contracts themselves can be traded between options traders. Speculative trading in long options, months or even years out, can make a profit for someone even if they never have an intention of ever exercising them, because if you buy an option when a stock is going down, the contract price goes down because people lose confidence that the option will actually reach the stock price; conversely, after doing so, if the stock rallies and the contract looks more and more like it'll be in-the-money (again, be a price lower than the stock's market value), the contract ITSELF has added value, because people will pay due to the speculation that the price will keep going up and the contract will be a better and better discount.

Call options are traded on a weekly (for a month out from when they're offered), monthly (for the next year from offer date), or yearly (January of the next two years after the offer date) basis. So long as the contract exists, and isn't exercised, the shares can ONLY be sold to whoever holds the contract. And due to options trading having value all its own, no, despite what may make sense on the surface, people do NOT immediately exercise options the moment they're in the money, instead they hold onto them as long as possible to see whether it "lives up to its potential".

Now, as of last week, the highest GME strike prices were... 100-something? As of just yesterday, 320. As of two years ago, when people bought these contracts loooooong before the coof, before the squeeze, before we knew ANY of this shit was coming? $40 strikes. Every single one of these options is in-the-money right now. And with the squeeze happening, everyone is holding on till the last second to squeeze every speculative cent out of them before passing it to the next person willing to buy the contract, before the next, etc., until everyone's playing a game of hot potato until market close tomorrow.

By market close tomorrow, every single one of these options, I believe around 100,000 contracts, still active as of today will either be exercised (whoever holds them now owns 100 shares of GME) or expired (control of the shares returns to the original shareholder). Each contract represents 100 shares, remember. 100,000 contracts * 100 shares = 10,000,000 shares now available to trade on the market itself. At that point, they can be bought by the shorts to then return to their lenders.

This is why people are saying the true squeeze might not be till next week, because until those shares are available again, the shorts can not possibly close their positions. There literally are not enough shares available for them to cover all of their shorted stocks, not until the contracts are ended one way or another.

They don't HAVE to buy the shares at all, technically speaking.

The impetus comes from the fact that every day that they don't cost them loads of tendies in interest rates.

But yeah, nothing magical about tomorrow as like a "if they don't buy they're forced to buy" day. For whatever reason, no one, no matter how deep into margin they are, is FORCED to buy shares the same way that you can be FORCED to sell shares if you're overdrafted.

Main reason tomorrow is significant because there's tens of millions of shares in call options -- options traded since January 2019 -- that will suddenly be freed from their contracts and available to the market. As long as those shares were locked up in options, the shorts were mathematically unable to cover all of their positions.

Well, just for your reference, most retail trader apps have frozen purchase of so called "meme stocks" anyways, so no one else can get in even if they wanted to.

I disclosed my position and added the "not an advisor" blurb because technically, if someone construed me explaining the circumstances as advice and bought in, and loses it all, I could be held legally liable.

The fact that you're sitting here going "hurr be careful guys this dude's just trying to scam you" tells me you're drinking the MSM fear koolaid, because the "w-we're protecting the little guy!" excuse is the current narrative du jour. Good job carrying water for the MSM and not reading literally any of what I said.

Only reason I posted this was to give an insight into what's going on, so that even people who have been on the sidelines and have no interest in this understand the ins and outs of how what's happening is happening, and why it's totally organic and possible under the right conditions, rather than listen to the literal lies that this is a freak event that shouldn't be possible that MSM is screeching to protect their wall street buddies.

The conditions leading to this are a series of 1% probability occurrences, to be clear, but nowhere along the line did something synthetic happen.

Let me reiterate one more time: shorts have to buy shares. Period. As of last I checked, short float is 140%. Even a quarter of that is 35%, if we assume ONLY a quarter of current short float is past-due back to brokers. That alone would mean that 35% of GME's 46 million shares on the market MUST be bought back by these hedge funds to return to their lenders. If no one sells to them, they'll say "okay, I'll pay more". If still no one sells, "okay, I'll pay even more." And this is a conservative estimate of how much they need to cover.

Do you need me to explain supply and demand for you, too?

All this financial data is available to anyone who wants to see it. The short interest isn't a fucking secret. The borrow rate for shorted shares isn't a fucking secret.

https://www.ortex.com/stocks/26195/shorts

If you don't understand what's going on, that's fine, but don't come in here and start spouting off bullshit. As I made crystal fucking clear in my OP and various replies ITT, the phenomenon that GME Short sellers are experiencing is quite possibly a once-in-a-century thing, and I don't want anyone to try to rush into buying the stock as some sort of get rich quick ticket to the moon.

Anyone here can read or watch any number of posts, threads, videos, etc. across all of social media, and be convinced into buying in, or warned off and told in no uncertain terms that they WILL lose if they participate now. That's not why I made this thread. People all make their own risk assessments. What I am doing is explaining just what is going on, for those unfamiliar with the market, so that regardless of whether or not they participate, they at least understand WHY this is happening, and how -- while incredibly rare -- this is a circumstance that happens in the market. Short squeezes are real. If you want to know why short squeezes exist, I guess re-read my OP.

They literally are at our mercy. This is why "1000 per share is not a meme" is a meme growing amidst us longs, albeit a very true meme.

They're backed against a wall. Now, something fucking absurd like 50k per share won't happen, because no matter how much they're bleeding in interest, there's no way it'll hurt them more than buying something that overpriced.

Put Options... complicated trader shit. It's far too late at night for me to explain it at the moment, either DuckDuckGo it or check back tomorrow for my writeup.

Call options are way easier to explain.

On a put? Are you fucking retarded?

Please tell me it was a March or April put at least, i.e. post-squeeze. Otherwise I won't feel sorry in the slightest for your losses, nothing personnel kid

I am not a financial adviser. I will reiterate this a million times.

However, there is speculation GME could hit literally $1000+ per shares if we hold our stocks hard enough to make shorts beg to buy them at ANYTHING we ask them for. GME currently trades for about 300 per share, European market and pre-market hours in the morning will probably have the stock opening at... I would predict 350-400 tomorrow morning.

Do with that what you will.

As insane as that would be, and I get that you're making a point, nothing else is even close to being in the same position as GME.

This squeeze is gonna be biblical due to a perfect storm of factors that have been going on for literally a year now. No other stock on the market, no matter how memed, is in a technical position that would result in them being "the next GME".

This is not to mention, as I covered in a direct reply to OP, in order for the hedges to need trillions with a T in bailout, GME would literally have to be covered at something like an average of 10k/share.

The squeeze is on the smoothbrains who've still been holding since last month or even November. From what I saw borrowable shares as of right now (what few there are) only have 6 DTC from borrow date.

I understand the sentiment, but the math doesn't work out.

With current short interest at... I think 140%? And GME float at 46m shares, that basically means 64.4m shorts need to be covered.

Let's say the squeeze is as biblical as some people hope and shares trade for 5000 bucks. Each short position will cost them 5k to cover (and that's nevermind the average will be lower due to the tapering up and down).

Even if every single short were covered at the meme peak of 5k, that would only require 322bil.

Still a ridiculously high amount, but not in the trillions.

More realistically (if we can call such insane amounts realistic), MAYBE we hit 1k average for the peak. That would be 64.4 billion cost to cover.

Just ONE of the hedge funds shorting this, Melvin Capital, had AUM (assets under management) around... 12bil I wanna say? So if they literally liquidate everything, that would take it down to 52bil to cover. Then the next hedge, then the next, etc.

I firmly believe that unless we reach retard levels of share valuation (call it 10% chance in my humble opinion), worst case is every hedge in a short position files chapter 11. Oh no not muh hedgies. And the worst impact from there is a general market earthquake as they dump literally everything they hold onto the open market.

All over one fucking stock.

Gamestop.

Edit: and to shit on the parade a bit more, we don't know how many of those shorts are at what expiration. Realistically, the only thing that needs to be covered are positions already overdue just so they can get the interest monkey off their back. That could be something like, spitballing here, 50% of short float for example. That means "only" 32 mil shares would need to be covered. Still silly, but using the 1k figure that would only be 32.2bil.

Kind of. That's more on the naked shorting, specifically, but they WILL be forced to cover those positions back to the lenders (the brokerages that lent them the shares in the first place). I guess theoretically there may be a doomsday scenario where they use some obscure rule or clause written in the trading rules somewhere to get out unscathed, or for a Rapture-tier event, they end up getting bailed out federally (specifically, it would be the banks that gave them capital in the first place).

But in general, it's not quite the same, because most of the shorting is done against the value of shares that ARE real. Put another way, I use RH because I'm a scrub, months ago RH lent Melvin Capital [the number of shares I have]. Melvin Capital owes those shares back to RH. They HAVE to give those shares, not cash-in-kind but shares, back to RH. So their ONLY CHOICE is to buy the shares from me, the shareholder, to then turn around and give them right back to the broker from whom I bought them in the first place.

The naked shorts were pretty much all either already closed, or are shorted against post-squeeze prices. And honestly speaking, anyone who shorts GME for... 2 or 3 weeks or so... out, will probably be able to make money as the price crashes down to fair value for GME's stock

Melvin Capital had lost 30% of their net worth by Monday (when they got their bailout from their sugar daddies at Citadel).

30%... since January 1st.

Someone did the math on WSB, for every... it was like 40? Bucks that GME went up, it cost them another 8 figures (can't remember exactly how much) per day to hold their short positions. That is, every 40 dollars GME increased, their interest cost increased by something in the 10s of millions, I can't remember any more specifically than that. But even if it were 10,000,000 exactly, that means that as of right now (the post was last week when GME was still at 40), they're now paying... 50? 60? Million dollars per day just to keep their short positions open. At least. I wanna say it was actually something like 40 mil, not 10 mil, and if that's the case they are losing 200 million fucking dollars a day.

As of the last time I saw the short float, it's (somehow still) at 143% short interest (that is, there are 143% of GME's stock shorted on the market. It's as dumb as it sounds.)

Now, let me be clear here: A LOT of current short interest is actually post-squeeze shorting. There are people who are in positions that are long enough that they shorted GME on its way up -- 50, 100, 200 dollar shorts -- and IF the squeeze completes before their shares are due back, they won't miss out on the interest.

But a sizable chunk, it's hard to tell how much because the data isn't readily available, are OG shorts who've been holding since the beginning a year ago, or one-month shorts or so who shorted in the past couple months and are already paying exorbitant interest rates (borrow interest was at like 60+%!) to hold on for just a couple more days.

It's essentially a massive game of chicken. Every day we hold, they get more and more desperate to cover and close their positions. And let's say 60% of the shorted shares are currently past-due -- THOSE are the shorts we're squeezing. After this is all done and over with, GME will fall to fair valuation, and anyone who managed to pull a naked short as the price climbed might just pull off getting out in the green once the post-squeeze price drop occurs.

Eh, the gains will be worth it, methinks.

Notice how I didn't even recommend anyone here buy GME, set nor declare my personal PT, and kept as vague as possible in what my positions are. I have no intention of implying that I am in any way smarter than any other retail investor right now. I really have nothing to offer y'all, and I've said the same both to people in various places online that I've mentioned my successes and to IRL friends, coworkers, etc., who want to know "hey man what's the next 10000% ticket to success"? Far as I can tell, there isn't one. GME is in a very unique situation right now.

But even on top of that, I honestly don't even have any idea what my move is once I cash out. I mean, first thing is setting aside however much math says I owe in tax (+10% or so probably for safety's sake), then I'm gonna be closing all my debts out, then... that's the thing, I really have no idea what the fuck to trade in next. This whole GME thing alone put me into the >25k territory (watch that get moved by all this drama) that lets me day trade at will, but even if I DIDN'T still have my job, like... I have no real idea of what, if anything, is the 'next big play'.

None of the meme stocks being pushed by WSB etc. have the technicals that GME does, and that total gain I can make off of them is probably already gonna be capped by the time GME shorts are squeezed for all they're worth. So I won't be playing AMC, BB, BBBY, none of those.

Probably just gonna invest in some fucking boomer stock with decent dividends while I finish out my navy contract through the end of this year, use the money to finance my move and new house, then figure it out from there.

I like your attitude, but no, not fucking day traders. DTs are slowing down the squeeze because they keep fucking pocketing 5% scalps every 5 fucking seconds.

If they would just hold this shit, the squeeze would already be over by now. Instead, they try to keep profit taking as often as they can for pennies on the dollar, and every time they do that they risk the shares being snatched up not by longs squeezing them but by shorts managing to snatch them up before we can.

The thing is, puts' risk is entirely on the contract holder.

When you short, you're putting the lender at risk, and when you do NAKED shorts, you put the actual legal owners of those stocks at risk (because their shares are being lent out even though their broker says "Yes, you have X amount of Y stock!", but then if the shareholder tries to sell the broker's like "ahhh... you see.... TEEEEECHNICALLY you DON'T have that share after all, we lent it out to [Hedge Fund], sorry, you'll have to wait to sell your position.")

I already said this in my OP: There is no "next target", at least not one that I can see (and it would skirt legality to imply there's a "next target" as it gives ammo to the "GME was 'targeted' by reddit manipulators!" narrative.)

But there is nothing else that has the same technicals as GME. Nothing else was so aggressively shorted and made such a snap-back recovery, nothing else had 5 pieces of big news come and keep their price up, nothing else has several multi-billion-dollar hedge funds who just kept doubling down rather than bailing out. Nothing else will squeeze this hard, and depending on if the government and/or SEC decides to play the "no more toys for you" game, the conditions that led to this squeeze may NEVER come again.

The irritating thing here is that, as I'm sure you're aware, a LOT of boomers/retirees have their 401ks or IRAs tied up in these hedge funds.

As someone (You, maybe?) said in another thread I saw, they're holding our own money hostage against us (the common people). If we torch the hedges, sure, I and whoever else gets to walk away with bags from the squeeze make out with a profit, but it harms tens, hundreds of thousands, maybe millions, of people whose accounts have value BECAUSE they're built up on the backs of this short selling bullshit.

I'm very much a bull trader myself, in case my sentiment wasn't clear, but I do understand why there's a case to be made in very specific circumstances where the stock ACTUALLY IS worth a fraction of what it's worth, and shorting basically starts the avalanche to run shitty companies into the ground until they either unfuck themselves from whatever they're doing wrong or go insolvent.

But given the choice between having shorts able to make sentiment plays (as anti-GME/anti-brick-and-mortar-american-companies shorts did this past year) in addition to the "white hat" shorts, and not allowing shorting at all? Yeah, I'd err on the side of taking the ability away. Why the fuck would you WILLFULLY bet on people/a company failing? That's just fucked up.

commie losers on reddit

Kind of, but I'm in it too (have been for a couple months now) based on wall street fuckery. We're basically playing the exact same game fancy suit-wearing assholes on the street play every fucking day, just using trading apps instead of multi-million hedge funds.

If you're cheering for the hedge funds, you're doing it wrong. They make their money by betting on companies to fail (which is already bad enough), but ALSO by having their media buddies run hitpieces on why the stock they're shorting is gonna go down, you better get out! Then normies panic and sell at a loss, the shorts buy the now discounted shares, and return them to the lender, pocketing the difference.

To boil it down to "commies on reddit" and imply (mistakenly or not) that the hedge funds are the good guys is... Well, no, they're fucking not.

The other, key point, is that they doubled and tripled down on their shorts because they were convinced GME was going bankrupt. If they did so, their shares become worthless, and the hedge funds would have gotten every single cent they could have.

The trouble started when Michael Burry (of Big Short fame) took an anti-short position, which kept it chugging along, and then Ryan Cohen (of Chewy) bought into GME. The possibility that Cohen will manage to turn it into a decent e-retailer the same way he did chewy, along with the fact that GME survived long enough to reach this current console cycle, means they're not at an immediate risk of bankruptcy.

This puts the shorts in a really really bad position, as they pay interest for every day they owe the share back past the due date which was probably months ago. Yes, GME MIGHT bankrupt in a year or two... But they can't hold their short positions that long, simply because of interest. It wouldn't be worth it.