Thread by @ripster47

#tradingtips #floatMechanics 1
Some trades are more than Technical/Fundamentals.
What I call Float Mechanics
What is Float, How Many are Short, How much is restricted or held by institutes, What is liquidity on a super low float stock. Supply/Demand..

#tradingtips #floatmechanics 2
When you see crazy moves like $APVO $LGVN there are reasons beyond fundamentals/technical
If tradable float is only 3Mil shares (means only 3 Mil shares to buy/sell), You ever think when it trades 50 Mil where is that all vol coming from..

#tradingtips #floatmechanics 3
Do you wonder who is buying and who is selling?
What shares are changing hands and how, How is float rotating 10 times(means exchanged hands 10 times around)-3 Mil float at 30 Mil vol has traded 10 times its shares that is (Float Rotation)

#tradingtips #floatmechanics 4
At that point borrowed, synthetic, naked whatever you call it shares come into picture, just too many shares that are not supposed to be there...
..Now lets say original buyers never sell there 3 Mil(complete float)..but

#tradingtips #floatmechanics 5shorts keep selling their artificial shares expecting price to go down...but there is hardly any supply but so much demand....like 10 times what is available to trade...so stock keeps going parabolic...shorts pump more artificial shares..

#tradingtips #floatmechanics 6...stock goes parabolic and shorts get deep in red....from 3 to 20...now...each pullback, short just try to cover, buyers see support & buy...so real buying + artificial buying...stock keeps going parabolic..cause each pullback is cover for shorts..

#tradingtips #floatmechanics..7
...how long will this go on...can keep going on as long as demand is their and shorts dnt give up...when they have covered all their artificial shares...admit loss.... then when buyers finally sell what they hold..is when stock finally gives up..

#tradingtips #floatmechanics 8
..now even next day or after..stock falls back but shorts are still there...they want to now cover...but guess what no sellers...no vol..no liquidity...shorts cover aggressive...more buyers come in...and run starts again...supply/demand

#tradingtips #floatmechanics
..Its way more complicated then I am trying to explain but key here is supply demand, specially on these micro floats or small floats...when there is so much artificial supply...and real demand...u see the parabolic moves 🙏