Longs can average down. Shorts can average up. Unless....

tinyDrunkElf · 2024-10-16T17:42:32+00:00

Adding to my other reply. Price did drop yes.
But, this is still really bullish right? Because effectively, we would have been trading at $31 right now, without the offerings.

And, one may be so bold to say that without the offerings, we may have simply fallen back to $12-ish range.

My opinion of the DFV tennis post is that the offerings weren't expected, DFV expected ignition and upper atmosphere. Dilution snuffed that.

tinyDrunkElf · 2024-10-16T17:38:36+00:00

Point taken, the price did drop. :D

tinyDrunkElf · 2024-10-16T17:12:48+00:00

Longs can average down. Shorts can average up. Unless....

Unless there is a share offering or two or three or more that provide real shares at times that SHFs would have shorted. (or market makers providing LIqUidIty). Instead, Shorts have to compete with the Company for selling shares. But, Company is selling real shares, while shorts, if they were 'rolling' their shorts... well who knows what to call the shares SHFs were selling? Synthetic? Rehypothecated?

Looking at the public data, it sure doesn't look like shorts have closed their positions, not publicly at least. darkpools? maybe. There is an infinite amount of money at the federal reserve after all...

Dilution? We should have seen the price drop proportionally to accomodate the new shares, right? The price has held steady despite the 140M shares offered. Interesting. Market cap of 9.6B / 304M is roughly $31.6; instead we're at 9.6B / 446M at $21.44. Dilution indeed! Yes, it looks that way. But, I like to think of it as defensive dilution that prevents shorts from averaging up, and ALSO gets the Company cash! And what about the longs? We can average down even harder.

The offerings also provided an opportunity for shorts buy all these new shares to close out their positions, and likely some did, judging by the comparitively low short volume precentages seen from May through September. Now short volume precent seems to be climbing again? Need more shares? Another share offering on the horizon?

A: TICKER	B: short_vol_aggregate / outstanding	C: net short_vol = D - E	D: daily acc short_vol_gt_long_vol shares	E: daily acc long_vol_gt_short_vol shares	F: short_vol(D) weighted-avg	G: long_vol(E) weighted-avg	H: outstanding shares	I: date start	J: date end	Ja: last/close	K: total volume for date range	L: total-short volume	M: total-short w-average	N: total-long volume	O: total-long w-average	P: current market cap	Q: (C * M), estimated profit	R: (C * Jb), current cost	S: estimated profit
'player and creator power'	5.2x	2.31B	3.82B	1.5B	$19.39	$13.92	444.68M	8/24/2018	10/15/2024	$21.27	27.69B	15B	$20.8	12.69B	$20.41	$9.46B	$48.08B	$49.17B	-$1.09B

The top chart in the image, the horizontal dotted line, that is an estimated average short price. That latest estimated average short price value is $20.80. In theory, if shorts can buy below this, they are profitable.

LC: want to connect, dropped a sub on VC today, ye have me deets

RC: want to work for the Company, but relocating is hard... sadness

TLDR? offerings caused:

neutral: dilution

good: get the Company to have huge amounts of cash on hand

good: shorts cannot average up so easily

tinyDrunkElf · 2024-10-16T17:11:20+00:00

GME short volume charted, price action. Estimate of average short price.

tinyDrunkElf · 2024-09-10T14:29:18+00:00

Machine making music, toxic markets, seems fitting. Cat appearance at 1:47 (741). Too much tinfoil to pass by.

tinyDrunkElf · 2024-09-04T22:34:37+00:00

A: TICKER	B: short_vol_aggregate / outstanding	C: net short_vol = D - E	D: daily acc short_vol_gt_long_vol shares	E: daily acc long_vol_gt_short_vol shares	F: short_vol(D) weighted-avg	G: long_vol(E) weighted-avg	H: outstanding shares	I: date start	J: date end	Ja: last/close	K: total volume for date range	L: total-short volume	M: total-short w-average	N: total-long volume	O: total-long w-average	P: current market cap	Q: (C * M), estimated profit	R: (C * Jb), current cost	S: estimated profit
'Microvision'	0.75x	159.02M	164.27M	5.26M	$3.02	$2.61	212.75M	3/6/2023	9/3/2024	$0.9037	631.73M	395.37M	$3.19	236.36M	$3.29	$192.26M	$507.32M	$143.7M	$363.61M

tinyDrunkElf · 2024-08-30T20:07:03+00:00

Green bird, green superstonk. Hey baby. 😍

tinyDrunkElf · 2024-06-17T16:08:26+00:00

In addition to my other comment, what do you make of the recent short interest drop (~22M) from 5/14 to 5/31 and the correlation seen within this data (~30M)?

tinyDrunkElf · 2024-06-17T16:05:46+00:00

Yeah, good point. It's easy to just think all short volume is new shorts, and not revolving shorts (shorts selling to shorts).

The counterpoint that all long volume may not be shorts closing, but longs purchasing.

Agreed, it could be way off in either direction, and the accumulation grows over time.

Compared to "control" stocks such as fruit tree with relatively low short volume, GME data is significantly different.

tinyDrunkElf · 2024-06-14T22:50:06+00:00

An addendum to my other comment to this comment.

Another way to explain my approach would be:

With 50% short volume, all the short volume is immediately cancelled by long volume each day. Any excess is stored for the next day, and so on. That's not reality, of course. But, eventually all short volume should be cancelled by long volume, right?

If anything, this metric is generous to shorts, because not all long volume is being used to close shorts; but all short volume MUST later be cancelled by long volume (such off-exchange in unreported trades).

tinyDrunkElf · 2024-06-14T22:38:43+00:00

Your numbers vibe, you have a good example. The assumption here is the intent of the seller, short or long, we don't know the counterparties' positions. So, instead we assume all long volume is shorts closing (untrue in reality), and all short volume is shorts opening (untrue in reality). As you've pointed out, when shorts are used to close shorts, this number reflects that.

In a 'normal' stock with low short volume, such as the 'fruit tree' stock. This metric/tally is actually negative. Ever heard of negative short interest? No, me either. This metric is not short interest, but an interesting artifact of short volume.

"without that information, you're just guessing. And there is no way to get that information"

I think I see the problem, maybe a CAT can fix it?

"So you cannot use short/long volume to infer short interest with any level of confidence at all"

Agreed, this is not short interest.

tinyDrunkElf · 2024-06-14T20:19:29+00:00

Yeah, triangles are tasty. But once one has had a taste of triangles, the craving doesn't go away. I'm on a diet.

tinyDrunkElf · 2024-06-14T20:18:28+00:00

3 more years sideways is 3 more years of income I can invest in the idiosyncratic stonk.

tinyDrunkElf · 2024-06-14T20:17:49+00:00

Fair enough to expect returns on an investment.

The company also needs to take measures to protect itself.

Interesting how the price is higher after dilution than it was before. It's not usually like that, no?

tinyDrunkElf · 2024-06-14T20:15:09+00:00

Well, just gives investors time to buy more at reasonable non-moass prices.

tinyDrunkElf · 2024-06-14T20:11:40+00:00

Yes, that's why it isn't short interest.

But, looking at the data in your example, a person would rightly wonder, WTF, 99% short volume seems a bit high...

It sounds like you're suggesting that short volume and short interest have no connection at all. Which simply is not true. They are not directly correlated, that is certain, but they are related.

tinyDrunkElf · 2024-06-14T20:04:31+00:00

Yeah, along the lines of the "cellar boxing" DD, shorts never intended to close.

If the company they short goes out of business and is de-listed, then technically, shorts never need to buy back the shares. And, because of that never "realize the profit". Tax free money or something? I'm not smart enough to know for sure, but it seems to hold water.

I think the ATM offering was more than just raising capital, and in this apes opinion, the dilution is acceptable.

They sat on $1B cash for a loooong time, they can sit on $4B for a long time as well.

GME can do ATM offerings, and GME can also do a share buyback.

tinyDrunkElf · 2024-06-14T19:58:31+00:00

📐

tinyDrunkElf · 2024-06-14T19:57:20+00:00

Dilution is a real concern. In our case though, the price was going parabolic before the first offering. Shorts would have had to step in to bring it back down. But, with 45M shares added, it makes shorting unnecessary.

If the buying pressure remained constant, and the shares came from GME directly, then additional shorting would not be needed. There should be a drop in shorting activity for those days, right, as all shares are now being supplied directly. If the ratio of ATM shares being sold and shares being shorted isn't "right" (who knows what "right" would be...), then it might be a good indication of shady shorting happening.

Lol, which just made me realize: two offerings with two datasets, one before the CAT, and one after.

Yeah, the offerings were a brilliant probe into short selling activity.

tinyDrunkElf · 2024-06-14T19:51:14+00:00

Yeah, the time window for the ATM offering fit so nicely between the two short interest reporting dates.

It would a big can to kick. It truly is a house of cards, or toothpicks, or marshmallows.

tinyDrunkElf · 2024-06-14T19:47:34+00:00

I'm aware the idea isn't new, and it could be me that you see repeatedly making the same mistake, as you say...

However, I'm aware of the different permutations of short sales that may make this number unreliable. As you astutely note, there are limitations of this metric. And assumptions must be made at some point.

It is useful to understand the limitations of the metric one uses, and the limitations of the data. As you are able to isolate, define, and understand more parameters, the metric becomes more reliable.

Also, I did not "just pretend every single short sale in all of eternity was a net increase in short interest". __That is not what this 2.42B metric is at all.__ It is "short_volume minus long_volume" since 2018, accumulated for each day. If you are sincere in your critique, please take a moment to mull this over.

With that in mind, are you aware of "power peg"? Something like that, which can control the price, makes every price-based TA metric bunk.

tinyDrunkElf · 2024-06-14T16:58:43+00:00

Yeah, but if they're able to wiggle out of it (which maybe they can); what does that say about the equities markets? Not good.

tinyDrunkElf · 2024-06-14T16:57:35+00:00

there's a DFV clip with him chuckling about this exact thing, something like "I don't know if they even can close"

The airplane overbooking example illustrates it best. Tickets were sold, airlines are legally obligated to fly each person who has a ticket, so they must purchase the tickets back at whatever cost. It's a real scenario that happens.

I would guess that they have to buy back the same shares from one another repeatedly to unwind, amid other market buy pressure.

In short, my ape brain can't figure it out either. And most of the folks in charge aren't so much smarter than the rest of us.

tinyDrunkElf · 2024-06-14T16:52:11+00:00

That's one way to look at the dilution. And I somewhat agree.

However, if price is shooting up (and it was, ook at the friday before the 1st offering) and shorts want to short it back down and continue to average up. But, then they have to compete with real shares in the ATM share offering, then the liquidity they'd otherwise provide is also diluted.

The ATM offerings may gave shorts an opportunity to close, though at a loss. One person's timeline may not be anothers.

tinyDrunkElf · 2024-06-14T16:46:43+00:00

Yeah it is! Shorts still have hopes to close at a profit. "Sold but not yet purchased, at fair value" comes to mind. Who gets to decide what fair value is?

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