Global Macro Trading Journal

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I have been talking about this forever. People from Wall Street (what I call NY crowd) struggle understanding optionality, that's why they have been so late on Crypto (in fact, most are still out). People from Sillicon Valley get it
Of course, you can take this too far, and thats when bubbles and large overvaluations form so its important to strike a balance between the 2 mindsets
 
GME touched $500 pre-market today. Shorts are getting squeezed 2 ways, one is in the price and the other is on the borrow fee which is over 200% last I heard. There is also the possibility that the shares they borrowed will be called by the broker (a buyin) forcing them to take the loss. These are the true 'fundamentals' in this type of situation
 

Chamath Full CNBC interview. I think he is pretty right on this. The day/swing traders I have seen when I was a full time day trader are better than most hedge funds on:

-risk management
-idea generation
-sensing the pulse of the market
-going for big bets when the time comes
-many other things

In fact, one of the best traders I know (lx21, which I interviewed in my book Traders of the New Era Expanded) is probably stalking GME right now for a big short. But its not a random short based on fundamentals like most idiotic HF managers do. No, it will done using volume, charts, market pulse, borrow avaliability, gut feeling and proper position sizing, etc

The reason these guys are so good is that they accumulated several LIFETIMES worth of experience in 10 years. There are so many more trades, so many lessons, so many situations, so many mistakes, etc

This is very similar to how online poker players crushed live poker when started to face the 'legends' that play old flawled poker. Most old poker pros cant beat the average high stakes NL holdem online game, its too tough for them
 
Of course there are probably plenty of idiots on wallstreetbets and I bet lots will be holding the bag when GME tops, afterall, most traders fail. But its a darwinian situation where the idiots go broke and you are left with better and better pros. And these props are better and better capitalized as they accumulate gains
 
https://twitter.com/x/status/1354547622133051393

Good overview of what happened. I get the feeling that this drama is not over. If the shorts are still over 130% of the float, retail got the shorts by the balls and they dont want to let go. Not to mention all the other high short interest stocks
Its like the entire long-short industry has turned into the London Whale
 
At this point all these 'autists' need to do is to not sell these stocks for a while, the borrow rates will do the rest. When you got to pay 40-200% a year to be short, you are pissing your pants when the stock is flat. And you can get mega squeezed at any point. These long-short funds are now learning why Buffett havent shorted shit since the 60s
 
We might get that long awaited selloff everyone is expecting in equities.

Million dollar question is: is it a 10-15% correction to buy or the start of something more serious?
 
tsznecki said:
We might get that long awaited selloff everyone is expecting in equities.

Million dollar question is: is it a 10-15% correction to buy or the start of something more serious?
More...
https://www.zerohedge.com/the-market-ear/jan29

Its like a financial civil war, people want to damage the system because they are angry. They will suffer the consequences as well but they want to make a statement. I think at some point the government will step in and halt trading on GME for quite some time and let all the T+2 trades settle but if that makes people even madder, when it reopens it might just make things worse
 
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