January 15th, Friday.
New York time is 6:47 in the morning, Lin Shicheng has been sitting in front of Trading Desk of Era Vanguard New York Office for almost two hours.
On the screen, GME's pre-market bidding jumped from 92 yuan to over 100 yuan.
It broke through 110 yuan, and finally settled at 118 yuan and 30 cents at 9:28.
He picked up the intercom and dialed Hotel Room of Zhao Chen.
"The opening gapped to 118. There were already 23 million shares of Trading Volume before the market opened."
The voice on the other end of the phone, Zhao Chen, was very sober, and it was obvious that she had woken up early.
"Have the investment bank's gamma exposure been checked?"
"Checked. We made estimates on seven Strike Price.
The two gears of 25 and 30 have the heaviest gamma, and the two gears of 40 and 50 are not light either.
The two levels of seventy-five and one hundred are newly accumulated, and Market Maker has not been fully hedged.
If the stock price stands at 120 today, all Buying Pressure stocks from investment banks ranging from 25 to 50 will come out."
"Where is Trading Volume?"
"Yesterday it was 120 million shares. With this trend before the market opens today, it may break through Two Hundred Million throughout the day."
Zhao Chen was silent for two seconds.
"Don't move if it's less than two hundred yuan. Don't do anything if it's more than two hundred yuan."
"Understood."
The phone hangs up.
Lin Shicheng turned to the screen. The opening bell had not yet sounded, but the pre-market price of GME had already begun to gap upward--
One hundred and nineteen, one hundred and twenty-one, one hundred and twenty-three.
Nine thirty.
In the first minute of trading, Trading Volume jumped directly to 18 million shares.
The stock price jumped from 118 yuan to 132 yuan in thirty seconds.
On the Lin Shicheng trading screen, the Buying Pressure depth of the order book was swallowed up at a speed visible to the naked eye.
Selling orders were thin - fewer than two thousand shares were added per second, while buy orders were flooding in.
"The first wave of hedging Buying Pressure is coming."
Analyst Chen Mo sitting next to Lin Shicheng stared at Gamma Model and said,
"Investment banks started buying at the 25 and 30 levels. The volume was huge, more than 500,000 shares per minute."
Lin Shicheng didn't reply, his eyes were fixed on the transaction details.
Every transaction scrolling on the screen is verifying Zhao Chen's previous judgment--
For stocks with a higher Short Selling ratio, once they enter the Gamma Squeeze range, Market Maker's hedging Buying Pressure will become the most ferocious promoter.
At 9:47, GME touched 145 yuan.
At 9:52, the first meltdown occurred.
The stock price dropped from 145 to 138 within five minutes, and was quickly pulled back by Buying Pressure.
At 10:08, the second meltdown occurred.
At 10:23, the stock price exceeded 150 yuan.
Lin Shicheng picked up the phone and dialed Zhao Chen.
"It's one hundred and fifty-two, and investment banks' hedging Buying Pressure at the seventy-five and one hundred levels has begun to accelerate. Trading Volume has exceeded 100 million shares."
"Short Selling proportion?"
"From 54 percent yesterday to 48 percent.
Short Sellers continues to be forced to close its position in Gamma Squeeze."
On the other end of the phone, Zhao Chen picked up Zisha Pot and poured a cup of tea. "How much does Melvin have left?"
"Less than three million shares. Point72 has about eight million. Citadel has over six million."
The remaining 20 million are retail investors Short Sellers and new entrants like Elliott Short Sellers."
"What's their status now?"
Lin Shicheng took a look at the real-time Short Selling data.
"I'm trying to carry it. Melvin's Liquidation Threshold is 25 yuan, and it has already fallen through.
They don't call it liquidation now, they call it surrender.
Point72's fund manager told CNBC this morning that 'GME's valuation has moved away from Fundamentals'.
But he didn't say they were closing positions.
Citadel's Ken Griffin sent an internal letter last week saying 'Short Selling GME is a bug'.
But he didn't close his position publicly either."
Zhao Chen laughed on the other end of the phone.
"They are all waiting. Waiting for the stock price to fall back. Waiting for retail investors to panic. Waiting for a decent exit price."
"The problem is," Lin Shicheng said,
"Their positions are too heavy. Whoever closes the position first will lose less, and whoever closes the position last will die."
So everyone wants others to drive down the price."
"Prisoner's Dilemma." Zhao Chen said, "They've locked themselves in."
At 12 noon, GME reported 148 yuan, and Trading Volume exceeded 400 million shares.
Lin Shicheng asked the trader to buy a sandwich and eat it while staring at the screen.
The floating profit of Era Vanguard's position has exceeded 800 million US Dollar, but he has no plans to operate.
Zhao Chen's instructions are very clear - don't move for less than two hundred yuan.
His job is to keep an eye on the market and report at any time, but not to sell at this position.
At 1:15 p. m., GME hit $152 again.
There was no fuse this time.
The stock price stayed sideways between 150 and 152 for nearly 20 minutes, and then began to slowly fall back -
One hundred and forty-nine, one hundred and forty-seven, one hundred and forty-five.
"Profit taking is taking place. Short-term retail investors are selling."
Lin Shicheng said nothing.
He took a look at the position at Options--
Among the Call Options held by Era Vanguard, Implied Volatility in the 25th and 30th grades of Strike Price has soared to more than 400%.
The price of each contract has increased from a few cents at the beginning of the year to dozens of dollars.
But he had no intention of closing the position. Zhao Chen said that Options would have to wait until Common Stock sold more than half of it before making any move.
At 2:40 p. m., GME rebounded from 145 to 151.
At two fifty-eight, the closing price was fixed at one hundred and forty-nine dollars and seven cents.
Trading Volume throughout the day--amount of 13 million shares.
Lin Shicheng leaned back on the chair and let out a long breath.
He picked up the intercom and dialed Zhao Chen.
"The closing price was one hundred and forty-nine seven. Trading Volume Two Hundred Million 13 million. Short Selling The ratio dropped to 48%."
"What happened to the position?"
"Common Stock did not move, still 9.9 million shares, accounting for 9.9%.
There are two thousand contracts on Options expiring today, Strike Price's 25th tranche, after the automatic exercise, we have 20,000 more shares of Common Stock.
So the position rose slightly to 9.92%."
"Don't worry about the exercise part, let it be in the account. We'll look at it tomorrow."
"Understood."
The phone was silent for a few seconds.
Zhao Chen picked up the teacup at the other end and took a sip.
"Citron Is there any movement over there?"
Lin Shicheng Switch to the social media monitoring page.
The last tweet from the Twitter account of Citron was three days ago, and the content was "GME's Short Sellers logic has not changed."
Andrew Left's personal account has no updates today.
"Left did not tweet today. But his Short Position is still there. He is probably waiting for the stock price to correct."
Zhao Chen picked up the tea cup on the other end of the phone. "He won't wait."
"When do you think he'll level up?"
"He will not take the initiative to level. He will wait until he is forced to level.
Wait until his prime broker calls him and tells him that the margin is not enough.
At that time, he will buy at the highest point and lock in the loss.
This is the fate of all Short Sellerss - they think they are waiting for a better exit price, but in the end they exit at the worst price."
Lin Shicheng was silent for two seconds. "What about our withdrawal?"
"More than two hundred yuan. I told you."
"What if it's less than two hundred?"
Zhao Chen laughed. "You think you can't reach it?"
Lin Shicheng glanced at the Short Selling data on the screen--
There are still 38 million shares of Short Sellers that have not been closed, and more than half of the positions were established for less than 50 yuan.
"It'll be there," he said.
"Then just wait."
The phone hangs up.
Lin Shicheng Open WallStreetBets Forum, DFV posted a post at two o'clock this afternoon--
"One hundred and fifty-two yuan. Short Sellers There are still 38 million shares that are still outstanding.
Among them, Melvin has less than 3 million left, Point72 has 8 million left, and Citadel has 6 million left.
The remaining 20 million are retail investors Short Sellers and new entrants like Elliott Short Sellers.
They are all waiting for the stock price to fall. But why should the stock price fall? No one is selling.
Era Vanguard is not for sale. Ryan Cohen is not for sale. I am not for sale."
There were more than 20,000 replies below the post.
The top entry was written by someone with the username "DeepFuckingValue_2" --
"DFV is right. Short Sellers's only hope is that retail investors are afraid of heights. But retail investors are not afraid of heights. Retail investors are buying."
Lin Shicheng closed the forum page and sent a text message to Zhao Chen--
"DFV posted. The mood is very stable. There is a high probability that Short Squeeze will continue tomorrow."
Zhao Chen's reply only had four words - "I got it."
At seven o'clock in the evening, Lin Shicheng left the office.
It gets dark early in winter in New York, and the neon lights on Broadway Avenue have already lit up.
As he was walking to the subway station, his phone vibrated - it was the second text message from Zhao Chen.
"The strategy remains unchanged tomorrow. Don't move below 200. Keep an eye on Melvin's position closing trend. They won't survive next week."
Lin Shicheng replied with "Received".
He put away his cell phone and walked into the subway station.
The wind from the train entering the station blew up the hem of his coat, and he suddenly remembered what Zhao Chen said in December last year -
"Short Sellers's biggest enemy is not the bulls, but themselves.
They think they are betting against the market, but they are actually betting against their margin account."
The train door opened. Lin Shicheng walked up and found a window seat to sit down.
Outside the window were the lights of New York winter night, and the darkness of the tunnel quickly swallowed up everything.
He closed his eyes.
There will be a tough battle tomorrow.