There was a Plebian uprising in markets the past week
Updated
And you just traded it.
Regardless of your position on the events of the past week it has been legendary.
I've been a member of R/WallStreetBets since 2017. Back when it had around 500,000 subscribers. And back then it was legitimately a place where you could get quality DD. See some ridiculous literal bets, and talk about hookers and blow. But since then it has morphed into a legitimate movement.
Back in 2019 the narrative that GME was a name that was investable, or even something good for a short squeeze we didn't have COVID. We didn't have a .25-.00 Fed Funds Rate. And options trading was something that was still relatively niche.
Fast forward to today. WSB's has over 3,000,000 subscribers (1,000,000 of those since Monday) and it had turned into a place of literal autistic screeching and Gen Z'ers and millennials throwing money on OTM calls on names that had momentum behind them. This is part of the phenomenon that propelled NDX to its blow off top over the Summer.
Fast forward to today - we were literally seeing a popular uprising against ANY stock that had a short float over 40%. And every single financial media outlet had the word
GME in their vernacular more times in an hour than they had Trump 6 weeks ago.
What you just witnessed was a plebiann uprising against the powers that be. "Big money". "Smart money".
A gaggle (or hoard) of retail traders just blew out a fucking hedge fund, more than one actually, in spectacular fashion.
The primary target of this insurrection was Melvin Capital, which had to get a fucking 2.75 billion dollar loan to stay solvent when all of these 19 year olds went after their throat.
But as of today that overflowed into all the other stocks which were heavily shorted. This, in my opinion, created a chain reaction in the market. Starting this morning it looked as if there were margin calls being handed out like candy, and at open there were enough sell orders on the books to drop NDX 1.7% in the first 5 mins of trade. Selling begets selling and as we saw more liquidation breaks, puts sold, and panic selling take hold the algos kicked up and over the course of the day we saw a massive down draft. All in the back drop of a Fed meeting and AAPl, TSLA, and FB earnings, which didn't help the situation.
As of right now the Wallstreetbets Discord has been shut down, and R/Wallstreetbets on Reddit has been locked to mods only.
What we saw today was this uprising come full circle. The inmates had taken over the asylum and the wardens had no issue gassing the entire building or burning it all down before they let them take control of it.
The question is if this is it; is this the beginning of the end of the market. And the answer is probably not. This was a shot across the bow. This is what a legion of us can do when we're empowered with knowledge and the tools to compete on the same playing field, in numbers, with the largest funds on the planet. Fucking Citadel, the main Market Maker who buys all of Robinhood's order flow had to bail out Melvin with 2 Billion of the capital to keep him solvent.
History does not repeat but it does rhyme. And a lot of parallels have been drawn to 1999. But, NDX took another 90% leg was taken before the final blow off top.
We're close. But not there yet.
I'm long as fuck this downdraft as now the lines of communication between the insurrectionists has been cut and the powers that be are breathing a sigh of relief.
But just know that what we saw today was an exercise in what CAN happen when you're at extremes for sentiment, leverage, and price action. Irrationality.
Take it as a warning shot. Because the next time you won't have the chance to get out of dodge like you will this time.
Head on a swivel.
Regardless of your position on the events of the past week it has been legendary.
I've been a member of R/WallStreetBets since 2017. Back when it had around 500,000 subscribers. And back then it was legitimately a place where you could get quality DD. See some ridiculous literal bets, and talk about hookers and blow. But since then it has morphed into a legitimate movement.
Back in 2019 the narrative that GME was a name that was investable, or even something good for a short squeeze we didn't have COVID. We didn't have a .25-.00 Fed Funds Rate. And options trading was something that was still relatively niche.
Fast forward to today. WSB's has over 3,000,000 subscribers (1,000,000 of those since Monday) and it had turned into a place of literal autistic screeching and Gen Z'ers and millennials throwing money on OTM calls on names that had momentum behind them. This is part of the phenomenon that propelled NDX to its blow off top over the Summer.
Fast forward to today - we were literally seeing a popular uprising against ANY stock that had a short float over 40%. And every single financial media outlet had the word
GME in their vernacular more times in an hour than they had Trump 6 weeks ago. What you just witnessed was a plebiann uprising against the powers that be. "Big money". "Smart money".
A gaggle (or hoard) of retail traders just blew out a fucking hedge fund, more than one actually, in spectacular fashion.
The primary target of this insurrection was Melvin Capital, which had to get a fucking 2.75 billion dollar loan to stay solvent when all of these 19 year olds went after their throat.
But as of today that overflowed into all the other stocks which were heavily shorted. This, in my opinion, created a chain reaction in the market. Starting this morning it looked as if there were margin calls being handed out like candy, and at open there were enough sell orders on the books to drop NDX 1.7% in the first 5 mins of trade. Selling begets selling and as we saw more liquidation breaks, puts sold, and panic selling take hold the algos kicked up and over the course of the day we saw a massive down draft. All in the back drop of a Fed meeting and AAPl, TSLA, and FB earnings, which didn't help the situation.
As of right now the Wallstreetbets Discord has been shut down, and R/Wallstreetbets on Reddit has been locked to mods only.
What we saw today was this uprising come full circle. The inmates had taken over the asylum and the wardens had no issue gassing the entire building or burning it all down before they let them take control of it.
The question is if this is it; is this the beginning of the end of the market. And the answer is probably not. This was a shot across the bow. This is what a legion of us can do when we're empowered with knowledge and the tools to compete on the same playing field, in numbers, with the largest funds on the planet. Fucking Citadel, the main Market Maker who buys all of Robinhood's order flow had to bail out Melvin with 2 Billion of the capital to keep him solvent.
History does not repeat but it does rhyme. And a lot of parallels have been drawn to 1999. But, NDX took another 90% leg was taken before the final blow off top.
We're close. But not there yet.
I'm long as fuck this downdraft as now the lines of communication between the insurrectionists has been cut and the powers that be are breathing a sigh of relief.
But just know that what we saw today was an exercise in what CAN happen when you're at extremes for sentiment, leverage, and price action. Irrationality.
Take it as a warning shot. Because the next time you won't have the chance to get out of dodge like you will this time.
Head on a swivel.
Note
Both Robinhood and IBKR have restricted GME, AMC, NOK, and all the other memes to sell only.A literal forced blow off top. How the fuck is THAT not market manipulation??
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