screenshot to show you guys what we kinda average. I feel like I carry my weight heavy! But regardless as long as you do 2-3 transactions a day we would love to have you on board!
I'll keep it simple, max pain on an options chain is the point where essentially those with the least amount of contracts (puts/ calls) are in the money. I.e the maximum point that traders lose cash and the house wins. This week's strike call was at $2 so market algos trailed downward to get as close as possible to that max pain price of $2. Now despite that i opened a small position at a $1.67 just in case if we hit a gamma ramp at the biggest $3 strike option. As you all know we didn't, but that's okay. Next weeks max pain is $2.50 along with a fair amount of ftds that are due. If we hit $3 good shot we run. Also ideally should be close above $3, intraday over $3 means less as markets restructure at eod. So now with this week over and price anchor of $2 has been lifted i opened a more sizable position at $2.26.
There's plenty of other things to talk about but no time. All you need to know is that there is risk here. May not squeeze, it may squeeze, odds have gone down but there is still opportunity to make money.
hey guys it's been a couple days so thought it would be a good idea to provide an update. There's a lot to go over so lets jump right into it.
First and foremost, price has dropped, its true. Those who scream 🚀 and to the moon don't understand medhanics they simply run on hype; that's fine but it can get you caught up on the short term.
So first, price dropping was expected, with max pain at $1.50 that's just a breeding ground for shorts and the numbers reflect that as well. On average we've seen 51% of all total volume over the past 4 trading days be short. Given the amount of volume the past 4 trading days, thats no small amount. To add to this, looking at the second screenshot the ctb (cost to borrow) and rebate, these shorts are willing to pay a premium for these shorts because they know it will likely be short term contracts. This can also be seen in the ctb and rebate that has seen both cost and rebate on the short seller to come down. This is typically the market pricing in less risk to them.
So is that? it's all doom and gloom? squeeze over? ABSOLUTELY NOT. I present to you ftds or failure to delivers (third screenshot) and the max pain of next friday. So for those not in the know, ftds are obligations to locate and purchase shares at the end of any securities contracts. At the end of said contract, the lender must provide you the shares that you are owed by purchasing either from the market or from what they have available. In the case they don't, they enter into an ftd which gives them up to 35 trading days to purchase from the market and provide the shares. Fun fact a lot of this started after one of the biggest ftds for $HTZ to the tune of 10m shares was due july 30th; with the second largest july 31st.
Now if you look while it pales in comparison, $HTZ is expecting a fairly decent size FTD deadline august 17th, the same week as the max pain being at $4 next friday along with an insane options chain due next friday.
All to say, expect short term dips but this keg is still very much so powdered.
p.s This post has been long enough, but if anybody wants a part 2 to talk about the options chain and such let me know!
btw i think it goes without saying, but no ai was used in the making of this.
hey guys you may have seen my post the past couple days if so lets talk whats new.
CTB SKYROCKETING TO 27.77% annualized. what that means is to open a short position it now costs them 0.076% per calendar day. or for every 100,000. about 76$/day. not crazy but combine it with that atrocious rebate and things get worse.
All of that is good and dandy but heres where things get really interesting. Yesterday's ctb rate was 9.22% and despite that if you look at my second screenshot reported short volume is in the very high tens of millions.
And then theres the elephant in the room, off exchange volume shot up to 8.18%. Typically the only reasons that occur is cause of 2 reasons:
and 2. internalizing volume to suppress pricing.
seeing the off exchange is whats got me bullish. This implies that the guard rails to prevent a squeeze are acting in overdrive!
edit:
as of 11:41am est ctb is now up to 29%, shares available to borrow at 7k and rebate even more negative now at -25.51%
hey guys, so if you saw my post this morning I'll just keep it brief. HOLY WHAT A DAY. First we had shares available to short collapse from 4m to 950k. price followed suit and came down, no surprises there. Then midday we briefly saw rebate almost go neutral while CTB COME DOWN... UNTIL 12 pm onward the most bullish thing occured. CTB AND NEGATIVE REBATE HAS STARTED TO EXPONENTIALLY RISE.
As a quick overview, ctb is the annual cost to borrow a share . Currently annualized every new short position is now getting charged a MASSIVE 7.79% FEE. Now to be fair, this isn't a short squeeze percent but its rise from 1.8% to 7.79% is building towards one!
Now secondly a rebate is how much the lender pays you for giving your cash for them to hold. Typically they park it in overnight holdings make a certain amount and give you a certain kickback. For this to rise -4.16% means they are now charging you for holding on to their cash. typically markets do this when theres an increased risk of extreme volatility.
So with all of that being said, factoring in the options chain in the next coming weeks. Price sction is far from over!
thank you for listening
i wrote up a whole DD on friday but it got removed so I'll just keep this brief. Why I am bullish the long and short of it.
First off if you look at the first screenshot ctb has gone parabolic. started off at 1.83% by the end of friday it is now 4.5%.
rebates have gone negative.
and this is a big one, second screenshot 60m volume shorts on friday. all those shorts paying a much higher premium. You don't increase ctb and decrease rebate unless you expecting some extreme volatility.
last off, as of the past 30 minutes, somebody used up 3m of the 4m available shares to short in a 2-3% decrease in price. How that impacts the ctb ill be watching for.
i don't know if the squeeze is over, but there's a lot of reasons to believe volatility is not over.