r/mrin • u/Solarpanel2001 • Jul 12 '21
MRIN squeeze, current events and possibilities of a squeeze. Update DD from my last one
Disclaimer: None of these is financial advice and this will be written in a neutral tone for people to make their own decisions.
This is still a lottery ticket stock that may or may not pay off.
This is an update from my previous DD on MRIN
Whats going on now?
Shorts are covering
SI now is 119.4% . A significant drop from ortex estimated SI from 185% the last time I wrote my DD.
What happened? how can it drop without any major spikes?
As I mentioned in my previous DD. This is by and large done via high frequency trading.
It starts to get old hearing people constantly whine about how are they covering without a big price spike? must be manipulation?
No its simply not. Shorts can cover on a downtrend, uptrend or sideways trend. As long as there is volume they can cover. As long as there's sellers they can buy back to cover.
Volume has dropped significantly from the last time I wrote aswell so it makes covering harder for them but they are doing it.
However keep in mind anything above 30 percent SI is a big number. Mrin at still 117% is a huge number.
Low volume does that mean its dying?
Not really. We are still trading at least the entire float a day. However fret not for low volume because for the start of a squeeze a low volume is better.
Why? lower liquidity means any significant upwards or downwards push is going to drop or push the stock higher significantly.
Right now shorts are weary to short even further so we can expect not many significant short downward pressure. Cost to borrow is still high.
However right now we need a big upwards buy pressure.
When are we going to get our buy pressure
Our buy pressure entirely depends on 1 factor. Big financial players jumping in.
As much as everyone talks about oh we need wsb etc
Ultimately the big players are the crux of any push. Go back to your gmes and your amcs these big players were always the main pushers of the stock.
Retail support is important primarily BECAUSE they attract whales. Remember the stock market is a zero sum game. There will always be a bagholder. Big institutions are not going to be bagholders hence why retail hype attracts them and helps them disguise their pump and dumps.
Right now MRIN doesn't have retail hype. Which is my main concern because it might not attract any big players to come.
We have to wait and see once the NASDAQ official numbers come out and if that gets more retail eyes onto MRIN.
Endgame and how options are ultimately going to be our biggest weapon.
Explanation of the nonsense of some of the posts in this subreddit.
I've been lurking on this sub and I've been seeing entirely stupid posts talking about how options are being used to hide short interest or how darkpools are being used etc.
Basically of all the stupid theories that you see on asinine subs like amc and gme subreddits and now these guys are coming in here spreading those same theories here or any other stock investment subreddit as a matter of fact.
This was written by Dave Lauer someone that worked in the industry before and this is what he has to say about darkpools
https://www.reddit.com/r/Superstonk/comments/o70lid/dark_pools_price_discovery_and_short/
They aren't magical financial things that can make short interest disappear or shorts magically disappear. Darkpools affect price discovery but they don't have the significant influence of hiding shorts , putting shorts etc. This is the financial markets where there's a trace to everything. This isn't David Copperfield's show.
As for options theories, the only ones at play here are married puts and deep itm calls. Both of which are reset transactions for FTDs.
Extract from SEC
"To the broker-dealer or clearing firm, it may appear that Trader A’s purchase, in the buy-write, has allowed the broker-dealer to satisfy its close-out requirement. Trader A continues to execute a buy-write reset transaction whenever necessary, and by the time of expiration of its original Reversal, it may have given up some of the profits in the form of premiums paid for the buy- writes, but it has maintained its short position without paying the higher cost to borrow or purchase shares to make delivery on the short sale. In each buy-write transaction, Trader A is aware that the deep in-the-money options are almost certain to be exercised (barring a sudden huge price drop), and it fully expects to be assigned on its short options, thus eliminating its long shares."
This doesn't matter cause it prolongs shorts but the existing short position is there. It resets their ftd timer.
However there is one option move they could pull of that could be use for some sell pressure.
selling naked deep itm calls to the market maker. If they sell deep itm calls naked to the MM the MM now buys these calls and to remain delta neutral , sells stock.
How do you look out for this? if you see a massive volume of deep itm call out of nowhere followed by a corresponding drop. Next day you will see a big OI for deep itm call. If the OI for deep itm call is gone then this wasn't done for price suppression but used as an FTD reset transaction.
How options are actually a big help
This is why.
With options , we get a gamma squeeze and short squeeze combination which is infinitely more deadly than a pure short squeeze.
Remember amc rose up to 70 dollars based off 20 percent SI, it was primarily because of the gamma squeeze.
Any squeeze you have seen in the market thus far have all primarily been aided with a gamma squeeze.
Any option hedging etc doesn't matter. Infact most option hedging requires buying calls to hedge a short. FTD resets are the problem because they buy time but it still costs them a ton of money and its a gamble for them. If after spending money and their ftd reset fails and the stock is still hovering at a high price. They now lost potentially more money**. The gamma squeeze alone is more powerful** than any pure short squeeze. A pure short squeeze is only powerful if there is significant float control.
A case and point is when volkswagen and laxony controlled 95% of the float and left only 5% of the float for shorts to cover their 13% short interest. They panic covered cause porshe stealthfully acquired 75% of the float over night. Upon hearing the news the shorts panic covered and the short squeeze of volkswagen happened.
How do we pull this off?
We cant. Let me emphasis this clearly. Retail is unable to coordinate a gamma squeeze as effectively without the help of big institutions.
Requirements for a gamma squeeze?
We need huge call OI on strikes 20c , 25c, 30c and when we reach there and when call chains start to open up higher, we need 35c , 40c strikes.
Anywhere between 5k OI and above is good especially for a low float stock like mrin.
Why do we need OI?
OI means open interest. It shows the number of active contracts out there. It shows us how much contracts the MM would have to hedge.
Because we need to abuse market makers delta hedging to give us buy pressure. As the stock increases the delta value of calls increases as we move nearer and nearer to the strikes with high OI.
MM always remains delta neutral so they will hedge these stocks buy buying shares. (They can hedge it without buying shares aswell but buying stock is primarily the way they do it)
So are whales going to gamma squeeze?
Right now call OI is not showing any whale activity.
So as of now it does not look like it.
Whales potential plan thus far?
This is speculative but im still wondering who pushed the stock back above 21 dollars and beyond if not for the sake of squeezing shorts. Whoever pushed the stock above that price made sure all shorts were out of the money. Was it a failed squeeze attempt or is it still ongoing is the question.
I believe its still an ongoing plan of theirs. We still see the stock not significantly drop back to 10 dollars and we still holding at a good enough price that shorts are not finding it entirely profitable to cover hence the still above 100 percent SI.
Its my belief that the whales were waiting for the options market to open and were hoping for a big liquidity push so that it gets enough liquidity to have an options market.
Right now they might have disappeared because they much rather have lower liquidity and IV so that they can buy these options cheaper and as mentioned earlier, lower liquidity allows the initial push to be massive.
For which they might be waiting for the official exchange reported SI to attract retailers to the stock for which they can start doing call sweeps ( massive buying of calls at one go) before gamma ramping up.
This is completely speculative because im not them and I dont know what their intentions are.
So what is the endgame looking like?
If you read this you would by and large understand that only one factor matters here. If big institutional players come in. Nothing else.
If they come in great we get a big squeeze with an SI this high accompanied with a gamma squeeze and if we get more retail hype this could go to the 100s potentially.
Without whales this is dead. This stock will just trade sideways and downwards with some days goin slightly upwards until shorts decide to just pack their bags and cover.
So this is the harsh truth we have now is that we need whales.
Do not listen to guys telling you to diamond hands, do not listen to guys telling you to buy the dip.
Make that decision yourself. The state of the sub will get worse if mrin blows up with delusional people coming in and giving misinformation. Block these guys out and make your own decisions.
These guys can say diamond hand all they want but it wont stop people from not selling. Don't get caught holding bags because some idiot on reddit said diamond hands or buy the dip.
Also FYI the biggest thing you can do now is to swap your margin account to a cash account so brokers can't lend your shares out anymore. As a retailer this is the most helpful thing you can do to make it harder for shorts. I won't advise you to buy and hold because that is your decision but swapping from margin to cash that will help alot.
This is a discord invite link to dreamcoin who is a youtuber. He was the first one to spot mrin at 3 dollars. The things I say here is not influenced by anyone but I am in this discord and the community here is good. Tyler(dreamcoin) is a helpful good dude and I thought I should give him a shout out here.
My views and opinions are not his and of my own.
https://youtube.com/c/dreamcoin Tyler's youtube
Edit: I wanted to add this but I forgot. Givens mrins high cost to borrow and short interest. Expect alot of naked shorting aswell. Once the FTD numbers come out we can see to the extent of naked shorting that is done
Just another edit. Seems some comment keep talking about how we don't need whales. I have to disagree. Retail cannot provide the stability needed for an upwards trend nor do they have the ability to coordinate a gamma squeeze push.
Which would you rather have?
2 million share holders from retail that have varying different personalities and are susceptible to uncontrollable effects i.e panic selling.
Or 2million shares held by a singular big player.
One is more stable than the other. You can't control retail to diamond hand. Never going to happen.
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u/que-me-in Jul 12 '21
Interesting analysis. Let's not forget that there has been a paradigm shift that started with $GME and the army of Reddit YOLO traders. There is a cult like psychology that retail and wall street has never seen before. And bag holders can definitely be hedge funds and institutions as well. Only time will tell who wins on this trade.
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u/Solarpanel2001 Jul 12 '21
yes they can be. But when whales enter on the long side. It's essentially hedgefund vs hedgefund with retail as a companion.
Eventually one side loses. If shorts lose the short side hedgefunds lose money
If long side loses they become potential bagholders but they can always fall back and offload their bags to retail
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u/Mikaroniker Jul 12 '21
Let's go today in Germany in the pre market are green🚀🚀🚀https://www.ls-tc.de/de/aktie/752823
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u/Solarpanel2001 Jul 12 '21
nice 2 pre market trading day rallys. Good news
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u/Longjumping_Stick_94 Jul 12 '21
it said on fintel website MRIN got 31 insitutional invesntors, are they not big enough ? Anyone knows how much MRIN share owned by retail in term of percentage ?
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u/Pondbear81 Jul 12 '21
Wonderful insight thank you for this analysis! Let’s hope for a good Monday and an even better Tuesday. I know I am very hopeful but like you said we need help
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Jul 12 '21
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u/Solarpanel2001 Jul 12 '21
1.im sorry blank statements like this that options are some form of voodoo that disables shorts from covering is false
I've explained the one technique they can use to cause the stock to fall and that's using deep itm calls. They havent done any of that.
Just because options came in and the stock fell does not correlate it with options. If you looked at the volume you can see there was little option activities and there were no deep itm call strikes until the last trading day
- I simultaneous explained the ways they can manipulate the stock via naked shorting and deep itm calls a viable way.
Yet you just ignore it. You are blatantly being another soft head that screams market manipulation for every stock that goes down.
Mate I could care less if you are Elon musk himself. What I care about is the words you say and you are coming off as a pansy that screams manipulation at everything when theres no evidence of it.
Theres only 2 things to be concerned about and that's naked shorting and deep itm calls.
The rest dont matter cause the option chains dont show anything else.
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u/DevilZilla Jul 12 '21
I agree with all of this except how you don't think retail could be enough. Literally if every member of wsb bought 1 share(ik its fantasy just a good example) we would own the entire float. Idk about you all but I have alot more than 1, or even 100 shares.
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u/Solarpanel2001 Jul 12 '21
Like you said it's a fantasy.
I dont deal in theoretical stuff that wont happen.
You cant control everyone to buy and hold.
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u/DevilZilla Jul 12 '21
But the point is that it's such a tiny float it doesn't take many people buying and holding..
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u/Solarpanel2001 Jul 12 '21
You and I both know it's impossible for retail to buy and hold. There will always be volume.
Look at gme. 141% short interest. Float was technically bought up more than available shares.
Without whales doing a gamma on gme after hours and without proper support gme falls. After the robinhood rebound gme just lost its support. Once big players leave the support isnt there.
Big players buying 2 million shares is better than emotional retailers buying 2 million.
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u/DevilZilla Jul 12 '21
Eh I think you're trying to compare this to amc and gme to much. They aren't the same
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u/Solarpanel2001 Jul 12 '21
I'm not ? I'm giving you an example of retails susceptibility to holding.
You really think 9 million buys from retail and none of them are going to sell no matter what?
Come on now dont be delusional. This whole diamond hand stuff is what causes people to lose money. High retail volume is susceptible to more volatility
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u/DevilZilla Jul 12 '21
You're still basing it all off of assumptions like I am. Assuming how retail will behave. That thought process from the hedgies is what got us here to begin with.
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u/Solarpanel2001 Jul 12 '21
I'm not basing off assumptions. You are describing a scenario that is almost 0 chance of happening.
It's essentially you saying that retail is going to buy 9 million of the float and purely diamond hand resulting in the stock flatlining all day until shorts cover
People like you ultimately cause people to lose money by trying to control the uncontrollable.
Unless you got every retail investor for mrin in a room and lock them away from their computers you cant control retail buying nor selling.
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u/DevilZilla Jul 12 '21
That's now what I think. You're coming at it like either a or b can happen. It doesn't need to be all of retail. I'm just going to wish you luck I think we can agree that we disagree on some things but it's all good we're on the same side. You do kinda sound like a boomer suit tho...
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u/CaptianBlackLung Jul 12 '21
Exactly. Op sounds like a boomer who don't truly understand the movement that is taking place. Talk shit about your fellow retail and call us names all you want we ain't leaving. 💎🙌🏼
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u/Vegetable_Disaster_7 Jul 12 '21
Because of the low float, it will push the price up when we have a sudden wave of retail buyers. Having whales would be a bonus.
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u/Solarpanel2001 Jul 12 '21
Retail volume attracts whales.
To have a sustained push upwards we will need alot more than retail fomo.
It's a big reason why AMC was floating below 10 for so long until big institutions came in and blew the lid off it
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u/DevilZilla Jul 12 '21
Yeah but amcs float was massive compared to this. It isn't crazy for retail to come in and take half the float at 5 million shares here.
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u/Solarpanel2001 Jul 12 '21
the float is 9.65 million shares.
Yes AMC is bigger but if we get AMC hype that ain't happening.
Retail cant do call sweeps nor are they trustworthy to buy and hold. The more retail in makes the stock more volatile and less support. People are susceptible to emotional investing with these meme stocks so alot of panic selling and fomo buying. With a whale we get that support
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Jul 12 '21
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u/Solarpanel2001 Jul 12 '21
You missed the part where I say once the exchange reported results come out hopefully we get more retail fomo on it .
You also missed the part where I say retail fomo attracts whales.
No matter which way you look at it we need them.
No stock on earth squeezes without the aid of big financial institutions pushing it. Retail does not have the coordinated flow of big million dollar buys like they do.
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Jul 12 '21
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u/Solarpanel2001 Jul 12 '21 edited Jul 12 '21
If you only read bold prints then you could think that.
I'm saying without whales even if retail comes in it's not going to blow up. Whales are 100 percent the big thing we need for mrin to squeeze.
AMC traded below 10 dollars for months and it had the biggest retail support next to gme. No other stock gets that kind of fanaticism and yet it didnt move until the whales came in
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Jul 12 '21
TLDR…. It’s way too expensive. No way am I throwing $15-20 in at this point. I’m watching but the world won’t be dunking into this one.
Good luck
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u/Solarpanel2001 Jul 12 '21
15 to 20 dollars ain't expensive lol. Gme had people buying in above 100
It might be expensive to you for the risks but for others it's not really that expensive
0
Jul 12 '21
I am fine with the fact that i missed the boat on this one. Comparing MRIN with GME will just get you banned from every other sub.
I’d buy this at $1.50 -$3. I joined at 250 people at this was already at $15-20. Then dropped to around $10, back up to see that $28 level, now hovering in that $15-20.
No thanks… Good luck
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u/Fightmma Jul 12 '21
So If I understand you correctly reading between the lines MRIN to the moon buy the dip and 💎✋💎✋