Welcome back to the channel everyone today, i want to talk about what happens when the shorts cover. How do we know the shorts are covering what price is amc going to reach? What's the aftermath going to look like, and where do we go from there? Trust me guys you do not want to miss this video, so stay tuned and let's make some money, but before we dive into the video, i just want to give a massive shout out to the 2 700 of you that have currently dinged that notification bell, because You guys are always the first to watch a new video as soon as it's released so guys be sure to drop a like down below subscribe to the channel and ding that notification bell, if you haven't already so that you don't miss another video. Just like this one, and now i want to dive straight in with the key information. So how can you tell when the shorts have covered? Firstly, you can tell by all text because that estimated current short interest will fall, but that's not really very useful, because we know that short interest figure on all text is heavily manipulated.

At the moment, the big institutions are borrowing even more shares and classing those shares. As covered shorts, thereby reducing the estimated short interest, however, actually increasing the number of shares on loan. So again, maybe you could look at the shares on loan from altex. We know that number's been going up quite a bit and is obviously very very far away from zero.

We can watch the number of shares on loan and wait for that to reach zero or at least to decrease massively. But again, that's not really very helpful. We know that because of the t plus two basis or text only reports short's, covering two days after they actually cover. If we go back to the amc chart, we can see that two days makes a hell of a lot of difference.

If we look back at january, when amc ran up to twenty dollars, two days later, the stock had fallen to between seven and twelve dollars, so between a fifty to seventy five percent full so way too late. If we look back at june, when amc ran up to seventy two dollars again, two days later, the stock had fallen between thirty seven and forty five dollars, so twenty five to fifty 50 full again far too late and you're never going to be able to time. The top, so i personally think that one of the best ways to gauge it is from market sentiment and people's reactions. What exactly do i mean by people's reactions? Well, let's watch this video of trey back in june when mc was running up to seventy dollars, ramp off lamp on come on we're so close, we're so close, we're so close.

Fifty dollars, you don't have much on the level twos there's almost nothing on that ask. We just need that ball through on volume. I mean there, it is there, it is there. It is there.

It is look at that freaking boop of candle baby, let's go 5106, is the high of that candle holy freaking crap, and it's still ripping it's still freaking. Ripping baby 51 36, the high of that freaking candle, that is up 59 on the day. Look at this huge big fat boom boom candle. This is gon na, be a two dollar move and a one minute: candle guys 52 32.

This is still freaking ripping holy freaking crap holy toledo. Lamp off lamp on lamp has never failed this yet 52. 86. 89.

93. 30. 53. Baby.

Look at this one minute: candle holy toledo up 64 on the day: 52. 95. 53. 53.

70. The new high of the day look at this each round. Five dollars like we freaking, called it guys. Look at this move one candle, one minute candle.

You got a three dollar swing from 50 dollars to freaking, 53 42, we're at 54.5420. This is not ending. This is looking nasty. This is pure filth.

This is disgusting. This is exactly what we said was gon na happen, my friends, the apes knew it all along. This is nasty. We got ta move arrow again, my friends.

We can't even keep up with how many times we got ta move aero. We can't even keep up with it. Look at this parabolic run up up 71 percent. We were about to test 55.

We got 55 ramp off lamp on. Let's get that freaking bear trap, set them up. Let's get that break over 55 dollars. I got ta make bigger arrows, we're almost at 57, we're almost at 57..

Look at this go. Look at this. Go oh dude, i'm so happy for you guys. I can't even i can't even i just can't i just can't so that was a video of trey when amc had that huge day when it ran out 95 all the way to 72.

So you saw how trey was reacting. He was going absolutely crazy, but that was off technically a fairly small fry move. It was only a gamma squeeze, barely any if not none of the shorts actually covered and therefore the actual short squeeze is going to be a lot more volatile than that. When we see trey start throwing his lamp out the window, his subway cup out the window when he starts throwing his computer out the window, that's when we know that the shorts are starting to cover when we've got regular people doing ridiculous ridiculous giveaways of cash.

Because of the sheer amount of money they're making on amc, that's when we know the shorts are going to be covering going off. That kind of sentiment is the best way to time the squeeze instead of trying to sell two days after the fact when the short interest data is updated on ortex, i guess that brings me on nicely to just how high is amc going to go. The short answer is, nobody really knows. Why is it that nobody really knows? Yes, we kind of know how many shorts there are based on the published data from s3 partners ortex and the exchange reported short interest data, but even that only reports.

The legal number of shares registered, it doesn't obviously report on the sheer amount of synthetic shorts. The filter delivers or anything else like that. That isn't reported and technically isn't mismarked. You can only really estimate how many synthetic shorts there are in the market right now.

However, i do think the squeeze is going to be a multi-day event, so we may be able to do some kind of calculations on the fly when the short squeeze does start to happen. There's obviously more than one hedge fund. That is shorting amc right at the moment. Not all of those hedge funds are going to cover their shorts at exactly the same time.

On exactly the same day, although saying that the short squeeze, and especially the squeezing portion of that short squeeze, is going to be a very short time event, i think maybe say two to three days until all of those hedge funds have covered and therefore, two days After the first kind of day of that squeeze, we might be able to look at ortex and see what kind of percentage of the shorts have covered and then extrapolate the current price action for that percentage. So, let's say, amc runs up x percent and 20 of the shorts in the market have covered at that point. Therefore, it'd be fair to assume that amc is going to run up five times that amount until a hundred percent of the shorts have covered because obviously five times twenty is a hundred again, that's only going to be looking at the number of legal shorts in the Market not including the synthetics, but i guess we just have to assume that the synthetic shorts are going to cover at the same rate as the legal chores. Again, when the squeeze does happen i'll be sure to continue making videos so that we can calculate that kind of return on the fly when it is actually happening.

And hopefully, then i can give you some kind of idea what price amc might actually reach when the squeeze gets going in terms of how long it's going to take to come back down again, it's going to be a fairly short term event. If we look at the volkswagen stock, we can obviously see that it was holding this kind of price somewhere between two and three hundred dollars, squeezed upwards, all the way to near a thousand and then came back down fairly quickly, probably in the space of a week Or two now i guess you could compare it to tesla and say well tesla squeezed over many many months. What says amc won't squeeze over many months. I think the amc squeeze is going to be triggered by that market event that everyone keeps talking about and therefore it's going to be something sudden.

That happens at one point, not something that happens progressively over many months, but i think it's also important to factor in trading halts as well. There are a series of specific bans in which a stock's price is allowed to move taken from a reference of the average price in the previous 5 minutes. When talking about limit downs, if the price exceeds the lower band trading is suspended for 15 minutes again, if the price exceeds the upper band, it's also suspended again for 15 minutes. Amc is a tier 2 nms security and therefore, if the price goes up 10 or 20 in a five minute period, trading will be halted for 15 minutes during the squeeze.

Amc is likely to trade up and down up and down very violently, and therefore trading is likely to be halted for quite a large portion of the day, especially when those larger funds get liquidated. Those liquidations will pretty much sweep the entire market order book for all buy orders. Here's a look at the level 2 data for amc from a little while ago, if a large fund gets liquidated, it's pretty much going to take out. All of these asks down the entire order book.

That means that 30 is going to go 40. 50. 60, 70, 80. 90.

100. Every single order in the entire order book is going to go and then the order book is going to slowly start filling back up with people putting in new sell orders, meaning that the amc price is going to bounce around very, very aggressively when that happens. So what about the aftermath what's going to happen? Well, when a hedge fund gets liquidated, all of their positions, get liquidated and they also don't really have a say in the matter. That means they're going to have to sell off all of their long positions and use the cash from those long positions in order to buy back the amc stock.

When i say they don't get a say in the matter, it means that when they get liquidated, there will be a receiver appointed to sort out those affairs for them. An accounting firm, like pwc, will come in and basically organize all the creditors, all the long positions or the short positions and find a way to set off the long positions cover the short positions and make sure everyone gets a fair amount of money, most probably pennies. On a dollar and shareholders obviously receive the least amount of money. It's the same way.

A business is closed down effectively. Banks get first right because obviously they've got fixed loan agreements and then creditors get the next right after that, and then shareholders obviously receive the least amount of money. So when some people are saying, even if they get liquidated, what happens if they just short more effectively because they don't get a say in the matter, there will be a different, firm, that's appointed, to cover those positions for them. However, as a result of the new rules that are being introduced - 2021, 010, 803, 011 and 014, hopefully this market crash scenario is going to be avoided because all of those long positions will be lent out to other institutions for cash.

The cash can be used to cover the short positions and buy our amc shares. Therefore, all of those long positions won't just get dumped into the market and won't cause a giant, market-wide sell-off and perhaps a recession and crash the economy. As i said earlier, the short squeeze is going to be a fairly short-term event and therefore the amc price is likely to spike up very high and then come back, maybe a few days, maybe a week or two later. So what happens after the amc squeeze? Where do we go next? Well, i personally won't be going anywhere i'll still be here on youtube, making videos for all of you.

Maybe we end up going to the next big stock, or maybe we go to cryptocurrency, or maybe we just go back to our normal lives. Just a lot lot, richer, guys be sure to. Let me know down in the comments below what you think is going to happen when amc squeezes and how you're going to tell when the shorts have covered. And if you want to pick up some shares in amc.

But you haven't even yet signed up for a trading platform be sure to sign up with fidelity because they don't sell your order flow to market makers like citadel who root it through the dark pool. Basically, don't use robin hood or weeble or other platforms like that. Although saying that we will are an excellent beginner, investing platform, they've got great, charting they've got news, option order, flow company fundamentals and figures. They've, basically got everything, so if you do want to sign up with weeble, be sure to use the link down in the description below to get some free shares.

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