DWAC the SPAC getting WACKED?
Updated
So here is the deal. This SPAC (Special Purpose Acquisition Company) did exactly what it was supposed to do. The short explanation is they raise a bunch of money rom investors. Once they complete that process, then find a private business that wants to go public and merge with said company- greatly reducing the red tape and time it takes to become a public company vs the traditional IPO route.
OKAY, now that the is out of the way for anyone not knowing what SPAC's are, we can move on. This SPAC may be and probably is the most controversial SPAC of the year or maybe even in the 2 years that trendy and minimally regulated SPAC's have become the new black. DWAC announced on Oct 21, 2021 that they will be merging with Donald Trump's digital media company TMTG. The day it was announced, it traded up something like 350%. I traded it that day into the next day. Then forgot it existed for all intents and purposes.
The reason I chart this today is today we finally closed the gap from Oct 21st into the 22nd and I threw some fib's on the daily just to see magic as I frequently do when I put fibs on tickers. That initial 2 day push after the merger announcement went from right around $10 to $175 in just 2 short days. Then like all good new IPO's, the investors that bought in ahead of time and made buttloads of money started offloading their shares and we sold off a bit. So interesting to me is the power of fibs and in particular the 0.618 extension where we actually traded right down to and held after the initial pump. We did lose that today and finally filled that initial hype gap. The fact that this particular name has had so much hype around it puts it on watch for me now that the initial move is done. A common IPO/SPAC announcement pattern is that initial pump just to slowly fade back down to a reasonable level. For this reason, I rarely touch IPO's or even SPACS until after they have done their thing for awhile. This one continues to have a lot of hype around it still which makes me interested to see if it may end up being another name grabbed by the meming Reddit crowd.
I grabbed a handful of shares after hours for a long swing. This is a riskier play so it was sized as such. Not my normal bread and butter trades, but a small position just in case this gap fill and near halfback prove to be enough to get a bounce. Leaving enough room that should we NOT end up being a hype name and see a bounce, I can advantageously add more shares at the 0.382 fib of $30. Should DWAC continue down the path of boring drift post-merger news- hype notwithstanding- and lose that level on a close with any sort of decisive price action, I would definitely cut the losses at that point as there is no telling how many bag holders DWAC the SPAC wants to WACK.
OKAY, now that the is out of the way for anyone not knowing what SPAC's are, we can move on. This SPAC may be and probably is the most controversial SPAC of the year or maybe even in the 2 years that trendy and minimally regulated SPAC's have become the new black. DWAC announced on Oct 21, 2021 that they will be merging with Donald Trump's digital media company TMTG. The day it was announced, it traded up something like 350%. I traded it that day into the next day. Then forgot it existed for all intents and purposes.
The reason I chart this today is today we finally closed the gap from Oct 21st into the 22nd and I threw some fib's on the daily just to see magic as I frequently do when I put fibs on tickers. That initial 2 day push after the merger announcement went from right around $10 to $175 in just 2 short days. Then like all good new IPO's, the investors that bought in ahead of time and made buttloads of money started offloading their shares and we sold off a bit. So interesting to me is the power of fibs and in particular the 0.618 extension where we actually traded right down to and held after the initial pump. We did lose that today and finally filled that initial hype gap. The fact that this particular name has had so much hype around it puts it on watch for me now that the initial move is done. A common IPO/SPAC announcement pattern is that initial pump just to slowly fade back down to a reasonable level. For this reason, I rarely touch IPO's or even SPACS until after they have done their thing for awhile. This one continues to have a lot of hype around it still which makes me interested to see if it may end up being another name grabbed by the meming Reddit crowd.
I grabbed a handful of shares after hours for a long swing. This is a riskier play so it was sized as such. Not my normal bread and butter trades, but a small position just in case this gap fill and near halfback prove to be enough to get a bounce. Leaving enough room that should we NOT end up being a hype name and see a bounce, I can advantageously add more shares at the 0.382 fib of $30. Should DWAC continue down the path of boring drift post-merger news- hype notwithstanding- and lose that level on a close with any sort of decisive price action, I would definitely cut the losses at that point as there is no telling how many bag holders DWAC the SPAC wants to WACK.
Note
Damn DWAC held that halfback like a mother. Watch what it does here at the 0.618. Caveat emptor: not in it. Watching to see how we close today. Might be setting up.
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