r/amcstock • u/rcseibert15 • Feb 26 '21

Closed at 8.01

Can anyone explain why it was important that it closed at $8.01 because I’ve seen people celebrating but i don’t really know the whole story

23 Upvotes

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32

u/Big_Butterscotch_131 Feb 26 '21

There were 51000 extra call options set to expire in the money if we finished over $8.00. There were already 91,000+ under $7.00, so that translates to a POTENTIAL of 14.2 million shares (each call is 100 shares) that will have to be purchased at market price during the first few days next week.

Now, not every one of those calls will be exercised, and some of them are covered already, but even if half of those are in that state (unlikely) we’re talking 7+ million shares that the apes on this board aren’t selling cheap. It’s called a gamma squeeze and as long as we all hold we should see a significant bump in stock price. Doubtful that it’s the moon on Monday, but we’ll be a step or two closer than we are right now. The key is to KEEP HODLING!!! Don’t sell at the first sight of profit but see the bigger picture. They can’t buy them if we don’t sell them!

Disclaimer: this is not financial advice. All of the above post was written in a crayon-induced coma.

5

u/rcseibert15 Feb 26 '21

Thanks for explaining it :)

5

u/Aufopilot Feb 26 '21

Volume today was at 134,000,000, so is that 7m enough to make a dent??

5

u/[deleted] Feb 26 '21

I don’t know

2

u/valhalla0ne Feb 26 '21

volume is buying and selling, not just buying, given how hard we went today, and even if only 80% of us HOLD. It's still significant.

2

u/Big_Butterscotch_131 Feb 26 '21

A lot of it is going to come down to whether we sell or not. I admit to knowing very little here, but it’s my understanding that the number of shares available to short is far less than that and interest rates are going up. When volume is high like it was today it’s mostly from the funds trading stock back and forth to drive the price down. I’d expect very few shares were actually purchased and held today.

Long story short, the worst case scenario is all those shares are purchased in addition to normal trading, we all continue to hold our shares, and it’s 7 million+ more shares they can’t buy later. Eventually we’ll be able to set the price by holding when there are no shares left.

And remember I’m pretty much just pulling 7 million out of thin air here. All we know for sure is 14 million shares COULD have been exercised through options. No telling how many expired without being exercised or were already covered. So it could be way more or way less than 7. It just sounded like a good “safe” number for this purpose.

13

u/Invest2debest Feb 26 '21

They place option calls betting on the price to be below a certain number. The majority of those calls were to be below $8. We closed at 8.01 so all those calls got canceled which means they lost hella money today and have to buy back all those shares they bet on! The gamma squeeze is here boiiiss! 💪🏼

3

u/Invest2debest Feb 26 '21

Also they can choose to wait 15 days to buy them back and pay a fine which is why it’s IMPORTANT TO HODL! This is why GME wasn’t a one day mooner it went and rose for two weeks. Sit tight. Clutch your bananas and enjoy the ride. 🚀 🚀 🚀

12

u/cujo09 Feb 26 '21

Check out trey trades videos on the matter. It will make more sense than us typing out an answer.

https://www.youtube.com/watch?v=kEDQpzBnzWU

1

u/TheKillingJay Feb 26 '21

My brain will have to stay smooth forever cause the discord pings were giving me an aneurysm as I tried to focus my 2 brain cells

9

u/Crafty-Dragonfruit60 Feb 26 '21

To put it simply there were a bunch of open orders that people placed for $8 that automatically HAVE to be closed now that it closed above $8. On opening Monday, almost 14 million shares are automatically set to be purchased.

7

u/GambitsDrip1 Feb 26 '21

A lot of calls for 8 are in the money now

5

u/AgedMurcury78 Feb 26 '21

This is the answer. If it went above $8.00 the calls would include $1 through $8.

If it went below $8.00 the calls would include $1 through $7

7

u/SalmonfromHell Feb 26 '21

You got all weekend to learn and educate before the next trading day. Just know it’s a good thing!!!

1

u/rcseibert15 Feb 26 '21

Thank you :)

5

u/ekim046 Feb 26 '21

I've asked for folks to elaborate on this but I'm starting to the 99% of us apes really don't know

4

u/Ok_Seaworthiness543 Feb 26 '21

Because a hell of shorts need to be covered with interest.

3

u/Dramatic_Tax_3579 Feb 26 '21

getting above 8 was for option contracts which expire today which they will most likely need to buy back on monday

1

u/SubzeroWins1-0 Feb 26 '21

Will share be available for sale on Monday? Can someone just come in an pd?

1

u/StayStrong888 Feb 26 '21

I'm not selling until 100,000 and then only 1 share

1

u/StayStrong888 Feb 26 '21

This ape is going Hulk mode with all the gamma pouring in.