💰YEET no. 30: BTD 2: Electric Boogaloo
Welcome to The Yeet, a weekly DD where we try to tilt the casino...
Hey! I’m @yourboymilt, and welcome to retail’s Sunday Paper.
I should probably let you know...This is not financial advice! We are here to entertain while giving you ideas, perspective, and angles. Do your own research, I prithee. And if you aren’t subscribed, join us here:
Creator/Editor:@YourBoyMilt The Architect: 🧠 Publishing Associate:@YourGirlRachie
Pt. 1: Week’s Thoughts, Pt. 2: Flow 101Video Tutorial, Pt. 3: Watchlist (Unusual Whales, Kalshi, SpotRAMBO), Pt. 4: Index Forecasts (@daarkmaagician )
Editorial Board: @jimengland & @jameoneill
💰 Pt. 1: BTD 2: Electric Boogaloo
YourBoyMilt and @goldenticktn1
Just when you thought it was safe to YOLO retail again…
Anotha one. Your Delta LEAPs may have survived Delta, but it looks like Omicron may have a little more swagger to it than previous mutations of Covid. I’m no scientist, so I won’t get into the details of this iteration of the ‘Vid, but I will say that the market reaction on Friday was scary as hell if it was a sign of things to come.
The typical Pandemic Shuffle befell the indices as cyclicals went down, stay-at-home went up, and accounts across the land were wiped out in half a day. But, was it an overreaction? This seems likely; as I’m writing this, news outlets are already starting to pull back on the naysaying that dominated the weekend.
Well, looks like that gigantic selloff Friday was really only useful inasmuch as it destroyed my precious NKE weeklies. F.
This swirl of news, cases, variants, FUD, sell-offs, rotations, and general 2020-style catastrophic movement on Friday got me thinking...was this just another BTD opportunity. I turned to someone smart to help me settle this question, and here is my main man—contributor @goldenticketin1—to help explain this through DIX and GEX!
The Dark Index (DIX) vs Gamma Exposure (GEX)
I’m not nearly as entertaining as @YourBoyMilt, but wanted to share the following; it is bullish, but dry.
Black Friday was a rough trading day for most of us. I was relieved at the end of the day to see a @SqueezeMetrics tweet that said:
This meant, someone was buying the juicy holiday sale. @SqueezeMetrics is a must follow and I’d suggest visiting their site, as well. It would benefit anyone to take a few minutes and read “The White Paper.” It explains so much. SqueezeMetrics is a subscription service. They posts these values on their website for free—however they want you to subscribe—where they break down over 8,000 popular tickers. It might explain why the graphs are so difficult to read, they are just a fraction of the data they offer.
A common misconception for retail investors is to always assume that short interest is a sign of bearish speculation. Market makers don’t own shares and sell short to provide a liquid market. When they facilitate a sale, they either take shares from the seller, a buy, or short shares, a sale. Market makers don’t always own the shares they are selling you. They make money on the spread, like a bookie, not by going long. They buy for $20.01 and sell for $20.02. Their sales, or short selling, will be reflected in the short interest stats from Finra. Eventually, the market maker needs to buy shares to cover their short sale. They will look to dark pools.
Market makers buy shares through dark pools because they can get a better price. Say we get a bid/ask like $20.01/20.02, they can buy shares through the dark pool for $20.015. Through volume, they extract even more profit.
It’s not really possible to know if a transaction through the dark pools is always a buy, but it is noted in “The White Paper” that days with higher short interest correlates with higher intraday returns, or to put plainly, higher short interest, using dark pool activity to cover, equals buying. The dark index Friday:
SqueezeMetrics posts the Dark Index (DIX) publicly on their website at https://squeezemetrics.com/monitor/dix and this is useful to understand market sentiment. Used in conjunction with Gamma Exposure (GEX), which is also found at the same website.
Gamma Exposure (GEX) is calculated to show how the hedging of the options bought and sold by market makers affects the market. High positive GEX means “shares will come to market to push price in the opposite of the prevailing direction.” Negative GEX indicates “shares will come to the market, but this time it's to push price along with the prevailing direction.” To note, GEX was still positive, but much lower than it has been in a long time. What the Gamma Exposure looked like Friday:
An interesting note, check the GEX right before 11/19 OPEX, the point on the graph is circled:
You can see the effect of everyone buying long puts to hedge for OPEX. Because market makers are short those puts, hedging means they sell shares, to anticipate the short puts they wrote being exercised. As SPY falls, more puts go ITM and more shares are sold by market makers, exacerbating the problem. Put options and their gamma causes price action to unwind faster, the same way a gamma squeeze with call options causes price action to increase.
SqueezeMetrics focuses on popular tickers, with 8,000 securities to choose from. Because they focus on more heavily traded tickers; I use this data to make a guess as to what the indices will do.
TL;DR, we want high DIX and low GEX, which is how we ended Black Friday, November 26, 2021. Seems just in time for the Santa Claus Rally?
I packed all the entertainment into the end:
Q: Where do you buy a lot of chicken broth?
A: The Stock Market
😂
Thanks, @goldenticketin1! For those such as myself who don’t do well parsing through smart people stuff, I’d sum up the appropriate response to this bullish writing as follows:
Futures are currently ripping, VIX is currently dipping, and it would seem all is well on the Western Front. The variants may vary and the FUD may get scary, but if there’s one lesson we’ve learned in this market it’s…
Never. Ever. Go full bear.
Welcome to YEET no. 30, brought to you by Omicron variant.
🌊 Pt. 2: Flow 101 Video Tutorial
Using the Unusual Whales Flow Tool.
Hey! So, as we’ve gotten absurdly far in Unusual Whales Flow Tutorials, it dawned on me that a video review of the first one could be beneficial! In this video we talk about using Alerts and Flow together to build confidence in a trade. There’s much more to unpack as we go but again, just the basics, here!
👀 Pt. 3: The Whale Watchlist Picks
Made possible with help from the @unusualwhales Alerts and Flow Tool. Sign up here!
🔒 Kalshi Stone Cold Lock of the Week: YES on Will Omicron make up greater than 1% of U.S. COVID-19 cases by the new year?
Given all the gloom and doom in the news this week, it seems like an easy way to pick up a quick 30% by holding until expiration (January 5th) or flipping for some profit along the way. Another way to look at this could be as a hedge; if you’re determined to stay long in the securities you have, trading against those positions by rolling with the Omicron news could be a smart way to lock in some dough!
Always be on the lookout for what Kalshi markets are open that are subject to quick news changes—another Kalshi trader picked up a quick 130% this week by just paying attention to Covid news and clicking accordingly…
🎯RAMBO to Watch
Events Catalysts listed daily at The YEET’s website—spotrambo.com
RAMBOs are investor Relations And Meeting Buy Opportunities, or in other words stock catalysts outside of earnings (such as Investor Days, Analyst Days, Product Launches, Conferences, and more!).
🎯RAMBO to Watch:
There may be other more “pumpey” events, but what sticks out here is that FIVN is having 5 different catalysts over the next two weeks. Typically when a company goes on a run like this, they have a LOT to say. I’d look at getting a monthly and riding the good news wave.
👀 The Watchlist: PLUG, SNOW, CHWY, BA, BBBY
1. PLUG calls > 40.74
🚨Divergent Flow
✌️Two way play
📈 PLUG: Flow Chart 5k+ Premium: 92% Bullish
⌚️PLUG: Expirations and Strike
⌚️Exp: 1/21, LEAPs🐂
🔨Strikes: 40 🐂
📊 PLUG: Chart
🔫 The PLUG Trigger: Calls > 40.74 // Puts < 39.46
2. SNOW calls > 363.64
📈 SNOW: Flow Chart 10k+ Premium: 73% Bullish
⌚️SNOW: Expirations and Strike
⌚️Exp: 12/17🐂
🔨Strikes: 360🐂
📊 SNOW: Chart
🔫 The SNOW Trigger: 363.64
3. CHWY calls > 70.05
📈 CHWY: Flow Chart 20k+ Premium: 99% bullish
⌚️CHWY: Expirations and Strike
⌚️Exp: 12/10, 12/17🐂
🔨Strikes: 70🐂
📊 CHWY: Chart
🔫 The CHWY Trigger: 70.05
4. BA calls > 200
📈 BA: Flow Chart 25k+ premium: 60% bullish
⌚️BA: Expirations and Strike
⌚️Exp: 12/3, 1/21🐂
🔨Strikes: 150, 185🐂
📊 BA: Chart
🔫 The BA Trigger: 200 (retest!)
5. BBBY calls > 21.12
📈 BBBY: Flow Chart 5k+ premium: 55% bullish
⌚️BBBY: Expirations and Strike
⌚️Exp: LEAPs🐂 12/17🐻
🔨Strikes: 16, 18🐂
📊 BBBY: Chart
🔫 The BBBY Trigger: 21.12
Pt. 4: Weather: SPY & QQQ Forecast by @daarkmaagician 🌦
Below is the chart & info for a SPY & QQQ forecast from @daarkmaagician, his DISCORD is the place to be (YEETers get two weeks free!).
SPY/QQQ Charts Legend:
Solid Blue= ATH, Green= Dark Pool Buys, Red= Dark Pool Sells, Purple= Dark Pools, Orange= Supports/Resistances, Teal= 9ema
SPY Forecast:
SPY Charts:
QQQ Forecast:
QQQ Charts:
Make sure you follow @daarkmaagician to get updates on the indexes daily!
Goodbye and thanks for reading! Questions, scoops, comments @yourboymilt or /u/alldatdalton. See you next week! ✌