Good Morning Hodlrs,
Wow. What an interesting few days we’ve had. Nonetheless, I hope everyone enjoyed their weekend and are as excited as I am to be back in the casino free-and-fair market. Let’s jump straight in, shall we?
First off, if you haven’t checked our favorite Pomeranian u/Criand‘s latest post, here it is. TL;DR: T+21/35 is confidently dispelled, however Net Capital remains an issue in terms of maintaining SHF balance sheets to avoid Marge. With the latest options expiry (7/16), we should see the “puck” passed back onto SHF balance sheets, thereby decaying the margin call threshold price for our beloved stonk. Price go up = tightening of the noose.
Okay, now for a couple disclaimers. This is not financial advice by any means. I am retarded in the most literal sense. Additionally, I know it’s common knowledge that we do not use options when dealing with the stonk. BUY and HODL is all you ever need, BUT, I do not wish to simply throw out the conversation of options because there’s some valuable information that can be gleaned by looking ahead into the options chain. Just because you don’t trade options doesn’t mean you can’t use that information to further your thesis and strategies.
To get straight to the point, I believe we are in line to see a gamma squeeze this week. For those of you in need of a few wrinkles, here’s a 9 minute video explaining how gamma squeezes work, along with a few helpful other terms such as delta +/-/neutral & delta-hedging. Once again, I do not condone options trading. This is just a helpful resource to further your understanding.
Real quick, let’s jump back to last week’s options expiry. I will be using max-pain as a sort of eyeball estimate to gauge sentiment on the stonk. What this means is I’m not diving into hard numbers and data– that is for the Elders with many more wrinkles than I. I’m simply eyeballing these charts and using what little braincells I have left to formulate some sort of sentiment on what people or institutions are betting on what the fake price will be.
Wut doing?
If you’ve been living under a rock for the past 12 hours, we now know that there’s not going to be a wellspring of FTDs streaming out of these expired OTM Puts– however, settlement of these options (effective today) will put a significant strain on the balance sheets of whoever was using these PUTS to provide collateral to stave of Marge.
Let’s look at this Friday, 7/23:
Feel that warmth in your loins?
Oh, oh my. And how do you gauge this sentiment? Extremely bullish??? APEISH??? This is what kept me up all night. And I pray that this is what’s also keeping SHF up all night, too. What you’re looking at is a MASSIVE BET that GME will moon this week. And if not this week?
7/30 Options Expiry:
“Mr. Burgundy, you have a MASSIVE erection.”
What this is telling me (again, AT A GLANCE!) that the demeanor moving forward for GameStop is extremely bullish from an options standpoint. The entire global financial market is walking on the edge of a knife, and all it could take is one whale, one announcement, quite possibly even one tweet to get this ball rolling into gamma-squeeze zone. GME is in the bull’s court now, and the cracks in the glass castle are widening– soon the rocket will shatter the illusion, and the rest of house of cards to follow.
TL;DR: Sentiment for GameStop is (and always has been) extremely bullish, however this week and next are prime set-ups for a gamma squeeze which will sling shot the stonk into the upper stratosphere and engage the MOASS thrusters.