I may have just figured out the margin call threshold with some simple math. I about shit myself. Its VERY consistent!
I've posted some memes on here before but this is my first take on a possible DD. I consider myself to be a two-wrinkle ape. No financial advice here y'all, just pure speculation that is awfully consistent.
My theory focuses on three of the four times that the price of GME was most overtly manipulated downward, which was in late January, early March and right now. The big decline in late March cannot be explained by my theory but you’ll see that it doesn’t matter for what I’m talking about. I wondered if these blatant attempts had something in common, like getting too close to prices that would trigger margin calls, with the trigger price trending downward given accruing short interest.
So, I did some simple math. The first peak was at $483.00 on January 28th and the second was at $348.50 on March 10th. The trading day on March 10th was 28 trading days after January 28th. The price difference between the peaks is $134.50. You divide this by 28 and you get $4.80. You could gather from this that the margin call trigger price decreases by $4.80 each trading day, or at least something close to that right?
If you continue to decrease this theoretical margin call trigger price by $4.80 every trading day after March 10th from that peak of $348.50, then you end up with these amounts for the past week:
A more precise rate of decline is $4.8035, so that’s why the numbers are a tiny bit off from $4.80. BUT HOLY FUCK! The closing price keeps getting closer and closer to the trigger price and this morning we were $8 higher than it, which leads me to my next point. The true trigger price is DEFINITELY above this calculation I came up with. Just because it peaked at $483 and $348 before doesn’t mean these numbers were the same amount below the true margin call prices at the time, which would throw off the $4.80 figure somewhat as well, but probably only by a small amount. I don’t necessarily think the decrease in margin call price is linear either like my model suggests. There are WAY too many variables and I’m just a two-wrinkle ape. However, the linear approach fits the fucking narrative of what has happened.
Think about it. This is the first time that the price keeps getting close or surpasses (for four days in a row) to the margin call trigger price. Back in January and April, once it got this close to it, it fell sharply and they were okay for a while. This is the first time that its been this close and they cannot drop the price like they want to. That’s why we are seeing daily price manipulation in this fashion and this sell wall. They are doing all they can but there’s no volume! APES ARE NOT SELLING THIS TIME!!!! They can only drop the price so much and they are just trying to tread water to live another day! I know this analysis is very flawed but the macro-level linear trend corroborates the narrative of what we are seeing. The peaks in January and March provided the baseline to see how much the margin call price declined each trading day over that period of time. If all my speculation has teeth to it, we would have never been able to test this linear trend until this week because this is only the third time we have gotten this close to the theoretical margin call trigger price. So basically, three of the four times we have seen the most aggressive downward price manipulation are the same three times the price has gotten closest to some downward trending line of margin call doom. As for the fourth time, the price had been trending downward for two weeks before hand. Also, if you are the hedgies, who’s to say that you are only going to naked short the fuck out of something when your back is against the wall?
That about sums up my speculation apes. Are your tits lactating yet? Buckle up, cause hedgies r fuk.
EDIT: I could be completely wrong and just took the indirect route of explaining how the end of the big triangle is imminent. If that is the case, its still great news.
Posted May 1, 2021, 12:51 AM UTC · edited