Okay folks, so we have three things to discuss. Number one: I want to give a violent update on the market and plays number two. I want to talk about what Kathy Wood just said why she is now warning that certain growth stocks are going to perform very poorly. But the main entree, number three, Amc.

I need to discuss a new data set that revealed something very, very interesting. something big that has changed in the buying behavior of retail traders who are buying Amc stock. This is something that we actually haven't seen before and I want to discuss with you exactly the implications of this and why. I believe that's incredibly bullish for the stock.

and before we get into it, the only thing that I ask in return is that you hit that ravishing like button and also don't forget to subscribe either. Okay. Market Very, very green. We just can't seem to get a decent dip these days.

Right when you think? okay, this time this time we're gonna get a dip all of a sudden. Wham, you get a inflow of massive buyers. This market just keeps getting bought up like none other. My thought process is, I wouldn't just keep buying things because they're at all-time highs.

I would look for strategic deals and I would also keep cash on the sidelines in case we do get bigger dips this fall because there are a lot of negative cattles on the horizon. Anyways, moving on. Let's start with Quantum Scape The scape of the Quantum. So earlier this week we were talking about how Quantum Scape had a big catalyst.

They announced that they had partnered with yet another top 10 automaker who signed an agreement to purchase more of their batteries, which is, of course an endorsement of their battery technology, which was the first time in a while that Qs had renewed confidence in it since it's well, dramatic drop from 132 just about a year ago. and today we've seen even more buying pressure and I've been extremely pleased to see a broader trend of these growth tech companies moving up. not based on oh, is this the next short squeeze candidate? It seems more and more people are buying companies, or more and more institutional funds are buying companies because they have strong fundamental catalysts. And then maybe secondly, there's a short squeeze-esque narrative behind it.

But overall, you're seeing the market recognize more and more of these fundamental catalysts, and considering still how far Quantum Scape is down. Since its last period of euphoria when people were just speculating on what Quantum Scape was going to do, I would argue that the story is far from over here. Okay next. after taking a nice breath, well, not really a breath, more of a gulp took us back to Monday valuations.

This was after address said they had reached an agreement with a lender to pay down its loan debt which they'll be paying in, you guessed it, shares of common stock. The biggest land mine with literally any short squeezed candidate right now is is The company exploiting it via delusion, and I can't really blame them. I mean, they see their stock going up massively, why not cash in? But we have seen other short squeezers bounce back after other offerings, although in the case of like a recent one any, for example, it wasn't nearly as much. But I'd say with this one, the battle is far from over and I'd continue to keep it on your radar, especially next week.

As usual when it comes to short squeezed candidates, selling off what we need is a consistent level of support, and then you start looking for signs of recovery. And of course, Captain America once said that with great volatility comes great responsibility. Okay, next, Kathy Woods. So now she's saying all of a sudden that traditional mega cap tech companies are overvalued and could be value trapped.

Similar to how she says that a lot of the S P 500 are value traps. Traditional mega cap growth companies include stocks like Amazon, Apple, Microsoft, Facebook, and what are her reasons? Well, she says that companies that have leveraged up buyback shares pay dividends and satisfy short-term oriented shareholders instead of investing that money in research and development, are going to find themselves in a pinch to service their debt. and in order to do so, they'll have to sell their increasingly obsolete products at lower prices. Pretty traditional Kathy Wood talk right there.

Certainly, there's a lot of dramatic value traps in the S P 500. I just don't see the biggest players like again, Alphabet aka Google, Amazon, Netflix, or even Apple not being able to adapt to trends. Those are like the biggest players in the niche, and most of them do invest a lot into research and development. Maybe you can make a hardware argument for hardware costs going down post chip shortage and negatively impacting Apple and Microsoft, but both especially Apple, have gotten really, really cloud based and really, really software based.

But I think that she's being dramatic here because she's trying to explain why Arc funds don't buy in mass a lot of these massive, massive mega tech companies. Quite frankly, they're not early stage growth companies anymore that have these insane growth potential rates like most of the funds like most the stocks and Ark's very, very aggressive funds. That he said, one of the parts that I really do agree with Kathy Wood on here is her railing against companies who are so short-term focused that their main priority seems to be just shooting money out to short-term focused shareholders who just want quick dividends who want you to do buybacks to rally up the share prices that want you to sacrifice everything in the long term in order to make yourself look so good in the short term. I had a professor once in college that told the class that dividends are basically bribes that companies pay you to make you forget that you're buying a company with low growth potential.

Now I'm not going to go that far. Dividends have their place, but the sentiment overall is true. The companies that are paying reliable and fairly high dividends tend to be the ones that have already matured to levels where it makes more sense for them to just give out their money instead of reinvested into their companies. companies that generally have their highest growth numbers behind them.

Now again, nothing's black and white, and there's plenty of good companies that pay out dividends. There's nothing wrong with that if it's done appropriately, but the ones that do it appropriately tend to be far long, late stage companies. Many others that cash out with high dividends are just doing so to please Wall Street analysts And they're doing it at the expense of R D. And Kathy Woody are saying, hey, if you're doing this at the expense of R D, well you're going to be paying all these dividends in the short run.

But eventually you're not going to have any money to do that anymore and you're going to have to sell all your products at deep deep discounts and you're going to be out competed by all the companies that decided to actually invest in themselves instead of appease. Again, Wall Street analysts who like you one day and hate you the next. Okay, moving on. Oogabooga Amc Now I was surprised that Amc didn't trade stronger today given the extremely green day that we had in the rest of the market.

But you look at short interest at all time highs with cost of borrows near lows, and it seems that the bears are holding an edge right now, at least when looking at their influence on the public price. Again, with estimated short interest at all-time highs, what does that mean? What means that there's more incentive than ever for Amc stock to go down? But here's where it gets really, really interesting. So Cnbc put out this data from Van to research, which was the same research firm that put out that chart from a couple weeks ago, saying that retail had their first net outflow day of Amc since February, which many called as an attempt to spread. Fud.

But hey, the point is, this isn't a group that wants to favor retail in any way, shape or form. I think that they're probably fairly indifferent to retail, but look at what their data says and how they've reacted to it. They just published a data set on what retail investors were buying on the September dip. They put Amc as the third top retail purchase with 90 million in retail purchases during the dip.

This buying pressure from retail during a period of time where we've gotten one of the worst dips that we've had in weeks, showed that once again, the Oogabooga enthusiasm is alive and well and is buying Amc at each dip, which again is what a lot of analysts have said isn't happening anymore. People have walked up and gone home and research does say time and time again that retail tends to shy away from every single dip in any stock that they like because it's dipping. and if it's dipping, that means it can never come back again, right? Because that's what you feel in your heart. But with Amc, it seems like the heart is telling retail trader something else.

The fact that so many people showed up during this downtrend which was a falling knife when it was dropping, showed that conviction is alive and well and 90 million in buying pressure from retail is substantial given this dip. and this buying pressure is so suggestive of the power of retail traders in this, to the extent that Vander research admitted it. They said in our last note we argued that retail investors appetite to buy the dip was waning. That statement wasn't completely accurate.

I think they meant to say wasn't accurate at all. But anyways, this is what they were telling their clients. They go on to say they are still more than willing to buy the dip talking about retail, but are demanding larger discounts to deploy their idle cash. Let me read this last part again because this is where it gets very, very important and this is where it gets to the big point of this video.

Are demanding larger discounts to deploy their idle cash. What does that mean? And how is this bullish? Well, this means that there's a ton of Amc ooga booga cash from retail on the sidelines that we don't see right now in the stock, but we will see at lower and lower prices. if this comment from vandal research is correct, which I believe they're right on the money here. Sort of like an effect every single time this goes to a new low.

There's this invisible cavalry that's behind the scenes that all of a sudden gets incentivized to buy it up because we're like, okay at this deal, at this price, this makes sense. To buy, it's sort of like in effect if Amc goes to lower and lower levels, a different calvary shows up at each level, A calvary that is stronger at each level because if you believe something's a good buy at 40, you definitely believe it's a good buy at 30. If you believe it's a good buy at 30, you definitely think it's a good deal at 20.. And if 40 was the first level at which you saw some of those buyers, imagine how many new buyers, how much new capital would be incentivized to buy in If this got it 35 or 30 dollars, the lower it goes, the more new capitals incentivize to go in and buy it because it's a better deal.

I don't want to lose you here. The reason this is bullish is because if you're a short seller and you've managed to get this down to say 25, you've had to go through level and level and level of incentivized debt buyers who again, are more incentivized at every single dip. and who again, more new capital comes into each dip that hadn't wanted to buy in at higher prices. But let's just say that you got this down to 25.

What would happen at 25? Well, all of a sudden, you'd be met with a new swarm of buyers that were nowhere to be found at say, price level of 50.. short sellers right now think they're only dealing with people that they dealt with at 50, 40, and 30.. What they're not realizing, and what a lot of us aren't realizing, is there's a lot of capital on the sidelines, both retail and likely institutional as well. that is behind the scenes, waiting, just waiting to get the right entry price.

It's almost like we, as retail traders, have been speculated on this entire time about the massive war chest that is behind short sellers in this, through dark pools, their bearish positions there, and then when it comes to retail. If what vandal research said is true, it suggests that there's a massive massive war chest of retail capital as well that nobody could see yet because it hasn't gotten to those price points where it would show up and with higher and higher short interest, short interest estimated short interest is at all-time highs right now. With that going up, what does that mean? Well, it means that if there is this war chest of buyers who are willing to buy in at lower price points, then all of a sudden this gets a lot more risky for short sellers who have now accelerated their bearish positions in this and need this to go down even more. The larger the scale of people that are willing to buy this at lower and lower prices, the harder it is going to be for short sellers to win this.

when you look at a stock price, you only see how many people are holding and buying it right now, but you don't see how many people would buy it at different levels with most squeeze stocks when they go down, they don't find any buyers until the next hype cycle with Amc. This data that Vanda research is presenting suggests that they do find buyers and they find them at lower levels. Which means that when you start stair stepping down, it's very difficult to lower the steps. It's also true that in terms of enthusiasm, we have to have this talk.

there's a big difference between people who buy Amc and are holding it right now than people who have bought other stocks and are holding them right now. The big difference is that the majority of people who are holding Amc are more likely to be green than ones that are holding other stocks, and that has a huge psychological difference. Not everybody who bought this late in the game are sitting on green positions right now, but the vast majority of people who either bought early, bought the dip, or even averaged up into some different trends or bought the rally in January are still green. Put another way, if you are green on Amc, or if you were recently agreeing on an Amc and you were green most of the year, then you're much more likely to have a good emotion when it comes to Amc.

Outside of the whole movement situation, and you're like, okay, well, now it's dipped. I want to buy more because I want to be even more green in the future. This is one of the things that for example, Gme kind of has working against it, and I'm not saying anything bad about Gme, but the enthusiasm level is a little bit different, right? Gme has been a little bit more of a heartthrob with Amc. If you bought it at any point before June 3rd, or many points since June 3rd, you are likely very, very green.

Whereas you look at something like Gme, it still hasn't returned back to its pre-buy button crash highs. It's followed a much worse trajectory, and you can thank a lot of the big retail brokers for that. But of course, life's unfair. We know that.

and if you're somebody that bought Gme during the last nine months, you're more likely to be in the red than somebody who bought Amc in the last nine months. And this is true when you compare Amc to almost any other meme stock right now. What I'm saying is that I do think that a huge advantage of the Amc has is its relative stronger consistency, which I believe will bode well for building more and more consistency in the future and continued enthusiasm down the road. The reason that's important is because when you get down to Vanda's research saying, hey, there's a lot of buyers that are showing up at lower and lower levels.

They may not be showing up now at higher levels, but they seem to be increasingly showing up and you get the lower and lower price points. The reason that's important to understand is like hey, well, if you have enthusiasm, they're going to keep showing up. And if they keep showing up, the enthusiasm is going to keep staying and eventually Shorts do have to cover. If what this data says is true, it looks like there's a silent, massive group of apes with the war chest ready to buy in.

When you get to lower price levels, it increasingly seems like there's a lot more than meets the eye here. Anyways, let me know what you think about the situation. If you have any questions, feel free to reach out to us below or join us on Ziptrader Circle if you'd like to learn how to trade. With our step-by-step lessons, our private chat, and of course our daily morning breathings where we brief on all the latest catalysts each and every market open morning, well I'll go ahead and put a link to Zip Trader.

You go ahead and watch the video on the Ziptraderu.com website and see if it's a good fit for you. Coupon code Fudstopper50 will get you 50 bucks off before checkout and if you're wondering what broker to trade these stocks on, Well, we like to always send new traders over to Weeble and they will give you two free stocks when you sign up and deposit just five dollars using our link below. Anyways, have a good one and I'll see you in the next video.