Reddit Rebellion Routed As Brokers Help Hedgies Hammer Most-Shorted Stocks

Reddit Rebellion Routed As Brokers Help Hedgies Hammer Most-Shorted Stocks

Things had gone just a little bit turbo in GME in the pre-market as it briefly topped $500…

But, that was not to be allowed by the powers that be.

Best day of the year for stocks as retail brokerages (most egregiously Robinhood) did all they could do to stop WSB’rs from continuing the carnage.

It was a reverse Robinhood move!

Brokerages all appeared to go offline at around the same time this morning as the upside momo was ignited, which was odd given that volume was significantly less than yesterday’s at the time…

Source: Bloomberg

The Top 10 Most-Shorted names in the Russell 3000 dropped an average of over 30% today as retail investors were in many cases barred from trading by their brokerage firms…

Source: Bloomberg

And that was enough to erase all of yesterday’s damage in the hedge fund baskets and unwind the gains from the soaring most-shorted stocks…

Source: Bloomberg

Which prompted an awkward question…

Big-Tech led the way higher during today’s best gains of the year but after around 230pmET (margin call time), the markets began to roll over and that weakness accelerated into the close…

Other crazy names today included AAL…

AMC was clubbed like a baby seal today…

And Silver Miner AG…

 

 

 

Source: Bloomberg

Bonds sold off as stocks soared today…

Source: Bloomberg

The dollar took a dive today ahead of the US cash open and never looked back…

Source: Bloomberg

Bitcoin was strongly bid as big-tech soared…

Source: Bloomberg

Gold traded rather chaotically today… spiking early and dumping into the London Fix… again!

Source: Bloomberg

Oil also pumped’n’dumped…

Source: Bloomberg

Finally, Chris Cole of Artemis Capital highlights the call-buying mania that has been so evident in recent weeks…

Despite the crackdown by multiple brokerage houses this morning to restrict trading on Gamestop, AMC Entertainment, and others, Americans’ curiosity in the “mother of all short squeezes” has resulted in record-high internet searches into what this market chaos means.  According to Google Trends, searches for “short squeeze” and “most shorted stocks” have soared to record highs this week. 

Searches for “short squeeze” has become a national phenomenon. In nearly every state, people are searching for the financial term, which is a rapid increase in the price due to a lack of supply and an excess of demand for the stock due to short-sellers covering their positions. Searches for “short squeeze” were the highest in New York, New Jersey, Massachusetts, California, and Maine. 

Besides “short squeeze,” Americans panic searched “most shorted stocks” as they attempted to find the next ten-bagger. Other phrases people searched for were “most shorted stocks today” and “most heavily shorted stocks.” 

While we know this won’t end well, the question is, when will the end come?

Tyler Durden
Thu, 01/28/2021 – 16:00

Share DeepPol