January 19, Tuesday.
New York At 7:03 in the morning, Lin Shicheng's cell phone vibrated three times on the bedside table.
He grabbed it in the dark and took a look - it was a message from his assistant Chen Mo, with only one line:
"GME exceeded 19 before the market opened. CNBC is warming up, saying that it is likely to exceed 200 today."
Lin Shicheng sat up, turned on the bedside lamp, and quickly looked through the pre-market data.
GME's pre-market bidding jumped from last night's closing price of 149.7 to 187. The depth of Buying Pressure was seven times the selling price.
He dialed Zhao Chen and answered the call after two rings.
"I saw it." Zhao Chen's voice was very calm,
"Start selling more than 200 yuan. The first batch of 500,000 shares will be controlled at an average price between 200 and 220."
"Understood. Where is the Options side?"
"Options won't move for now. Wait until more than half of Common Stock is sold before considering it."
"Received."
Lin Shicheng hang up the phone and wash up quickly.
Before going out, he glanced at WallStreetBets Forum--
DFV posted a post at 4 a. m. with only one line in the title. "Today is the day."
The content of the post is a picture with the following words:
"Short Sellers still has 38 million shares. Today they will buy back at least 5 million of them.
Two hundred dollars is not the end. Two hundred dollars is the starting point."
The comment area has exploded, with 12,000 replies, most of which are "HOLD" and "TO THE MOON".
At eight forty, Lin Shicheng walked into the office.
The six screens in front of Trading Desk are all on, and Chen Mo is already adjusting Gamma Model.
Lin Shicheng put down his bag and glanced at the pre-market data - GME had risen to 193 yuan before the market opened, Trading Volume had 18 million shares.
"Investment bank Gamma exposure updated."
Chen Mo said without raising his head,
"In the range of one hundred and fifty to two hundred, the investment bank's net Short Sellers Gamma is about eight million shares.
If the stock price reaches 200 today, they need to buy at least 12 million shares in the market to hedge."
"Where is Short Sellers?"
"Melvin's prime broker was contacting several investment banks this morning and asked if he could arrange Over-the-Counter Block Trade. No one answered."
Lin Shicheng laughed. "No one dares to answer. If you do, you will be facing the entire WSB."
At 9:15, it was the last round of pre-market bidding. GME was fixed at 198.5 yuan.
At 9:28, CNBC's camera cut to the studio.
The host spoke very quickly:
"GameStop is close to two hundred US Dollar before the market opens.
The stock has gained more than 4,000 percent this year.
Wall Street's Short Sellers is experiencing the most tragic event in history Short Squeeze.
We invited Andrew Left from Citron--"
The screen cuts to Left.
He was sitting in a dark office with a blank wall behind him.
His expression was calm, but the wrinkles at the corners of his eyes were much deeper than three months ago.
"Andrew, you said before that the target price for GameStop was five US Dollar.
Now the stock price is close to two hundred US Dollar. Citron. What is the current status of the position?"
Left was silent for three seconds.
"Citron decided to suspend Short Selling GameStop."
The host asked:
"What does suspending Short Selling mean? Have you closed your position?"
"We are no longer engaged in this battle. This battle has escaped any rational valuation framework.
Citron no longer makes any comments against GameStop."
"So you didn't close your position?"
Left did not answer this question. He continued:
"When the market is driven by emotions, Fundamentals analysis will be temporarily invalid.
Citron has chosen to withdraw from the discussion at this stage. But we believe that in the long term, valuations will return."
"You believe valuations will come back - so why not close the position?"
Left glanced at the host and moved the corners of his mouth, but did not smile.
"We've made it very clear. Citron Short Selling GameStop."
The screen switched back to the studio. The host turned to another guest - the analyst of Morgan Stanley.
Lin Shicheng turned off the sound, picked up the intercom and dialed Zhao Chen.
"Left went on CNBC. It said 'Short Selling is suspended', but the position was not closed."
Zhao Chen paused on the other end of the phone. "He panicked."
"How to say?"
"If he truly believed GME would fall back to five dollars, he would continue Add Position and wait for the stock price to return.
The fact that he doesn't Add Position means that he doesn't dare to Short Selling at the position of two hundred yuan.
He is waiting. Waiting for the stock price to fall back. Waiting for retail investors to be afraid of heights.
Bet we would sell at more than 200 yuan and leave the market.
This way he can close the position at a lower level."
"But what if the stock price doesn't fall?"
"Then he will die in this position."
Zhao Chen picked up Zisha Pot and poured a cup of tea.
"Left is a smart man.
But the most common mistake smart people make in the Short Squeeze market is to think that they can wait for a better exit price.
This price will never come around."
At nine-thirty, the market opens.
GME's first transaction price was one hundred and ninety-nine eight yuan.
Thirty seconds later, the stock price exceeded 200 yuan.
On the Lin Shicheng trading screen, the Buying Pressure depth of the order book is stacked at the position of 200 blocks with nearly 3 million shares piled up.
Hedging from investment banks Buying Pressure poured in like a flood--
Twenty-five, thirty, thirty-five, forty, fifty, seventy-five, one hundred, the Gamma hedging on seven Strike Price is started at the same time.
Trading Volume exceeded 80 million shares within fifteen minutes of the opening.
"Two hundred and three." Chen Mo stared at the screen and said, "Investment banks are chasing me."
At 9:47, GME touched 208 yuan.
Lin Shicheng picked up the phone and dialed Trading Desk.
"The first batch is sold. The target is 500,000 shares, and the price is between 208 and 215.
Place orders in batches, each order not exceeding 20,000 shares."
The trader starts executing.
On the screen, the sell orders of Era Vanguard flowed into the market like a trickle--
Each transaction is not big, but when it comes to prices above 200 yuan, selling orders are already thin.
Each sale will cause the price to drop briefly by a few cents, and then be quickly pushed back by Buying Pressure from Market Maker.
At 10:23, all 500,000 shares were traded.
The overall average price is 208 yuan and 40 cents.
Lin Shicheng marked on the transaction summary:
"Common Stock has sold a total of 500,000 shares, leaving approximately 4.4 million shares of Common Stock. Options has not yet closed its position."
He sent a text message to Zhao Chen:
"The first batch is completed. The average price is 2.08 million. The remaining amount is 4.4 million."
Zhao Chen replied, "Received. Keep staring."
At 10:50, GME exceeded 220 yuan.
CNBC's scrolling news strip read:
"GameStop broke through 220 US Dollar, and Short Sellers lost more than 3 billion US Dollar in a single day."
The title of Bloomberg is:
"Retail investors Short Squeeze institutions become full-scale news - the GameStop incident triggered global regulatory attention."
Reuters's push is:
"United States Securities and Exchange Commission is understood to be monitoring GameStop trading activity."