I believe I may have figured out what the market makers are doing with the deep ITM calls.
They're buying and exercising them instantly when delta is close to 1.00.
The premium and purchase of the shares, at those levels.
Market makers are guaranteeing acquisition of shares in order to sell them into the market and dump on the price, but by exercising options, they do not cause ANY change in the price because it is an executed contract.
Meaning... the purchase doesn't go through the exchange...
This is the same situation with ISDA contracts. They're privately exchanged between two parties that agree to shake hands on providing shares through selling of call options to be exercised almost precisely at-cost.
The short entity can then acquire these shares without buying
By not buying the shares directly from the market, the price does not move. Ergo, they have a way to cover some of their short positions. So by exercising the calls, they can report a net-neutral position for the purpose of meeting FINRA/SEC report deadlines.
But...
They now have a ton of shares they don't want...
What do they do with them?
They dump them. Smash the price on critical momentum, and crush large quantities of options that are nearly expiring ITM.
Examples of stocks they are targeting:
$ATER $AMC $GME $SDC $BBIG $FFIE $SENS
And on the up-swing, entities sell their covered/naked calls, buy OTM calls, and let it ride.
There are patterns in the charts, and they are all following wedge patterns. The oscillation on an hourly/daily scale becomes obvious. See call flow on $ATER from yesterday for example
The trick is spotting their massive deep ITM purchases. When they do this, it's a sign they are preparing to meet report deadlines and then dump the long positions to hurt retail.
It's a fucking dirty but legal loophole that they're using to ensure their naked calls expire OTM.
And they don't have to buy shares, thereby creating REAL buying pressure, because someone is partnering with them to ensure they get the calls they need.
Then they warn their counter-parties to buy puts & sell ATM calls before they dump. It's a backdoor, volatility trade
It's collusion at its finest, and the fact that so many participants with billions of dollars are willing to do it is everything that is wrong with our fucking economy.
There is no oversight or paper trail of these massive private trades that take place off-exchange through ISDA
It's being used to steal from everyone in the stock market who is trying to follow the rules, and abused by every entity that claims to "self-regulate"
This If we find who sold the ITM calls, we'll find who the colluding parties are.
Find who they sold to, and you find naked 🩳
This is an entirely new tier of grand larceny. Millions of dollars are being stolen daily from this volatility, and it's only possible because market makers and hedge funds have the liquidity to move the stock market as they please, and use loopholes to dodge the exchanges.
Everything I have said is all speculation, of course, but it is reflected in the behavior of the options market.
Anyone with insight into ISDA trades and the ability to find transaction records are the only people who could possibly find this out.
This is behind closed doors.
Unless apes get help from someone on the inside who is willing to blow the whistle on the ISDA master agreements between the firms that are trading these enormous options contracts, the true identity of who is defrauding retail will never be known.
I'm fucking angry, and I can't shut up about how angry I am.
The manipulation is obvious to anyone who pays attention, and the lack of action by regulators makes it obvious whose interests they serve by ignoring the actions of bad actors.
The SEC isn't going to help us. They aren't coming to save us.
We need to accept that reality.
The SEC doesn't benefit from destroying confidence in the US markets, which is exactly what this fraud would do if the truth got out.
It's up to us.
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I know tons of people will and have already said this was the wrong way to do this, but there really wasn't a "right" way to do it, because screenshots of my questions surrounding the proxy were taken without context and shared without my permission. 1/12
Someone took the decision out of my hands because they chose to start taking screenshots of what I thought was a candid, private discussion about the stock, and my attempts to do more DD that I was planning to share with everyone on social media.
2/12
I hasdn't even spent 15 seconds doing my DD before someone took what I said and started sharing it out of context with my name attached to a speculative statement about what I thought the proxy meant, and it started spreading around instantly.
I'm afraid I'm here to disclose to everyone that I'm exiting my $BBIG position. I have done some analysis on the proxy, which I was not able to confirm, but has nevertheless convinced me that, at least in the short term, it's too risky for me to continue.
I recently received a series of margin calls which have forced me to decide which stocks I was going to stay in and which ones I was going to have to walk away from, and $BBIG is one of the ones I had to cut loose.
The reason I cut $BBIG loose is because of personal financial reasons in order to protect myself and my own family's stability, which is something I've always advocated for everyone to do.
But now this has become a problem because too many people give my opinion too much weight.
@earvinburnin Sorry that I don't have better screenshots from that time. Back when I was talking about SPRT, I pointed out its call options chain had, combined from $0.50 to $12 strike for 9/17 expiration, a grand total of 200k calls ITM. Back then, this was more than the entire float.
@earvinburnin This doesn't mean that $BBIG can't squeeze, but it does mean that $SPRT's squeeze was tremendously rare. I've never seen a company's entire float ITM in calls before.
Right now $BBIG has 20% of its float ITM right now with another 20% above $12.
@earvinburnin But there is something you should know. More calls were bought in a single week when $SPRT was trading at $12 than in the past 3 months.
Over 100k of those calls were bought only days before it squeezed.
The same thing can happen here if Market Makers are dumb enough twice.
By popular request, here is my research on $ATER short squeeze play per my usual thesis.
Here's the short version... by the numbers, shorts are just now starting to realize... they fucked up.
Ortex data shows shorts got in around Aug 1st @ $9.15 or less (at best)
FTD spikes since then have been consistently happening every T+6 days (sign that market makers are involved)
Institutions piling in.
SI: 68% of FF
19% of FF is ITM in calls
Looks good!
The one piece missing is the short exempts. Short Exempt volume is hovering around 1.5% of short volume, but it's going to likely start showing up soon, if market makers have FTDs outstanding.
Doesn't mean it won't squeeze without the short-exempts going nuts, but I'd like more.
I wanted to give an update on my opinion of $SPRT because I'm getting asked quite a bit.
NFA...
I am still bullish on $SPRT, but at the moment, it's in a consolidation period. The SI of FF is over 86%, and the average short got in around ~$7.15.
They are at a 224% loss.
The problem we currently have is that market makers hedged and either delivered or bought-to-close their ITM options on the chain during the run up when everyone sold their ITM options. The 9/17 call chain only has about 6K calls ITM right now, so not much gamma anymore.
10/15 looks more interesting with 36,232 calls expiring ITM above $23. That's still 18% of the float.
Between the 86% SI and 20% of the float ITM between now and 10/15, $SPRT is still in a supply crisis, and I believe failures to deliver will be astronomical in the coming weeks.
The threshold securities list has proven to become a very lucrative method of picking short squeeze candidates. Combining my short exempt theory with threshold stocks has yielded three picks which show immense squeeze potential due to the FTDs against them.
For those who don't know...
Threshold securities are stocks with more that 0.5% of its outstanding shares in Failures-to-deliver (FTDs)
FTDs are a symptom of naked shorting, as well as institutions who fail to deliver in-the-money call options or lent shares that were recalled
Short exempts are a special tool of market makers (MMs) to take a short while a stock is on Short-sale restriction (SSR) or to short without locating a share to borrow.
These exemptions are intended for MMs to survive periods of massive volatility and frenzy buying.