Okay folks, prepare for violence. We've got a lot to talk about. First of all, a big catalyst is going to drop within the next 24 hours and that's why you saw the market trade so cautiously today with some people packing up their bags and going home and so of course we have to talk about what's going on and how to prepare for it. We also have major updates on some plays and of course for the main entree.

This evening we're also going to be talking about Amc and what today's data showed that short sellers are doing. Let's just say it looks like they haven't learned their lesson and the only thing that I ask in return for all of this is that you hit that ravishing like button and also don't forget to subscribe either. Okay, first update on plays. So Draftkings, the King of Drafts, had a tough morning.

a lot of drama with some short seller allegations. Short seller Hindenburg, alleged that Draftkings has black market connections. They said Draftking's merger with Bulgaria-based Sb Tech has opened it up to exposure link to black market gaming and money laundering, money laundering since one is putting your money in the laundry a bad thing. But for quick context, if you're not familiar with the story, Draftkings when deciding to go public via S-pac last year, wanted to also acquire a company that had a technology platform that it could use for its user base, and so they ultimately structured their merger to include Sb Tech, which had that platform.

Okay, great, so what's the problem? Well, Hindenburg's not so happy with that subsidiary. Hendenburg alleges that Sb Tech gets at least half of its revenue from quote black market operations. The allegations are that years before Sb Tech joined with draftkings, Sp Tech was offering its gambling platform in many areas where it was either a gray area if you can gamble or it was illegal to gamble such as the Middle East, South America, China, and Malaysia. And they say that when Sb Tech realized that the Us was starting to be more open to legalizing sports betting in 2017, Sb Tech started spinning off their gray area gambling operations into a different company and then legally had them as a client instead of the combined company.

Second entity would do all the dirty work and they would just pay Sp Techs to use their platform. Okay, let's go ahead and back up a second. Keep in mind when you're a short seller and you're putting out a short report, you have a massive incentive for people to freak out as much as possible. The short report at the end of the day doesn't even have to be right.

Shareholders just have to think you're right if you scare them to sell their positions. If they sell first, ask questions. Second, you already won because at the end of the day, how much money they make is not based on how right they are, but how convincing of a story they laid out. But at the same time I'll admit that I don't have the foot power to go to these Asian markets to actually see for myself whether or not Sb Tech is dealing with clients that engage in illegal gambling using their platform.

The big point here is that people are not buying draftkings because of Sb Tech. They're buying it because of the potential in North America. They're not buying it for Sb Tech's questionable exposure in Asia. They're not buying it because of Sb Tech's revenue contribution.

Sp Tech was acquired by Draftkings because Draftkings liked its technology, platform, and the talent that comes with it. I just don't think that Sb text revenue streams are incredibly important. I mean, Draftkings and their board of Directors. If this really bothered them, they could just go and shut off those clients.

Nobody likes Draftkings because of Sb Tech. People like Draftkings. Because people like Draftkings. They like this market, not some random markets that Hindenburg is attacking in different parts of the world.

Okay, next, in terms of catalyst plays, we haven't had a lot to work with so far this week. But regardless of market condition, identifying trends and catalysts and figuring out which ones are going to take is part of the game. But of the takers, today we had Trch. Not terrible.

Of course we briefed 30 minutes prior to market open. It tanked it open to 430 and then it ran to 615 at highs. For short-term catalyst traders, the goal is to find runners and then try to scalp some of that move. You're not going to catch all the move.

your goal is to find runners and then attack them violently. Okay, Alf was probably the best play today that we briefed on in the pre-market ride at four and it ran from four to seven fifty, which is about an eighty seven percent run. This was on the company entering an agreement to help supply and allocate ten thousand digital tablets to Lyft and Uber drivers. Not only that, but these tablets will be used to display advertisements to riders of said Uber and Lyft vehicles, and Elf will have that ongoing relationship in helping to provide said ads.

So this is a very fun catalyst because not only do they have that original job, but they have an ongoing agreement with them. and when you consider the low cap nature of Elf and the massive size of this deal, it made sense. That's really the benefit of getting up early and putting the work in before the market opens. You can be aware of some of these ahead of time and you can be in the right place at the right time when some of these golden Nuggets drop.

I like to look for catalysts where big, well-known companies team up with some small companies that offer some service that nobody's heard of before. That's what happened in the situation Uber and Lyft entrusted Elf. Okay, so what's happening tomorrow? Well, tomorrow the Fed will be given their much awaited policy update, their inflation updates, their economic outlook, update their tapering update, and their interest rate update. Obviously, the Fed's approach thus far has been that inflation spikes are going to be transitory, and so we need to keep easy money policies intact to ensure we move through the recovery smoothly.

They are basically employing a weight and see strategy, and at the same time we know the market cast a lot of doubt on this strategy earlier in the year, thinking the Fed was ridiculous for not expecting permanent hyperinflation, but over the last month we've seen the market become more and more accepting of the Fed's outlook, and more and more people agree. In fact, the Bank of America survey released today on Professional Investor Inflation Expectations showed that 73 of respondents to the survey see inflation as transitory, while now only 23 see it as permanent. However, transitory inflation is still inflation, and while maybe not anticipating an abrupt change in policy, the same survey shows that most believe that the Fed will likely start talking of slowing their asset purchases in the coming months august or September. Now we are in June.

that's a few months behind August or September. So what happens tomorrow? Well, every single word that Jerome Powell says tomorrow will be scrutinized. Is he hinting at future tapering? Is he going to pencil in a date for interest rate hikes post 2023? like he's projected. He's been very clear that he's focused on recovery, and he's willing to keep the easy money policies to see us through this recovery.

but has his stance changed? Are there some bombshell revelations in terms of his outlook? Now that we have a lot more inflation data, the Fed decides to taper earlier than expected or changed some of its easy money policies earlier than expected. Well, you're going to see the stock market freak out again. Alternatively, maybe he's thinking that the recovery is going a lot slower than everybody else thought. That could cause some sell-offs and recovery plays and some inflows back into tech place.

Or maybe he might just reiterate his current stance. We're waiting and seeing. we're not doing anything right now. Tomorrow's forecasts are going to have a dramatic effect on the market, and I wouldn't be surprised if we saw some cautious trading around that, so we'll keep you updated.

Okay, lastly, Amc, We saw the strongest brake attempt into the 60s we've seen in a couple weeks, getting as high as 64.71 I think you saw some evidence of that gamma squeeze pressure near open combined probably with Fomo rallying. but then boom, right when you broke 60, you saw tons of selling pressure try to attack that up trend. The same selling pressure that we've been seeing over the last week. By this time, the selling pressure wasn't enough to keep this from going far above 60.

it took a lot more ground into 64.71 And yes, the selling pressure ended up finding its way again after that 64 region probably helped by the red and anxious market today anticipating the Fed tomorrow, but we're certainly starting to see the bulls overpower these selling pressure bears that it finds in the 60s, and the uptrend has sustained itself very healthily since the dip in the 40s last week. Now in terms of data that we have of what short sellers are doing or text reported that short interest has increased the last couple of days, which actually could explain a lot of that targeted selling pressure that we've seen. Once this breaks above the 60s, it's almost like funds are like, okay, worst case scenario, we keep this bouncing from 40 to 60, but we all come together and keep it below 60. No matter what happens, every single time it goes above 60, there's a truckload of sellers just ready to run over all the buyers.

Just so much selling pressure that it feels like it's short sellers dumping and dumping shares at that level. and these numbers could potentially back that up. But hey, look, short interest data is probably incomplete to a large extent. If you have the opinion that there's a lot of naked short selling going on, then this only covers a small piece of the short seller pie.

But it's still worth mentioning because this is a sizeable increase no matter what way you look at it. Regular short sellers, not just naked short sellers, but regular short sellers are more emboldened than ever here. They have not given up their conviction they think retail is going to run for the hills, and they have not learned their lesson either. Apparently that retail isn't running for the hills.

It seems like at this point, funds they don't want to walk away. They want to earn their money back With Amc. They don't want to go home and explain to their clients that they lost all their money on a meme stock. If my five-year-old cousin ran a hedge fund, he could do better than risking half of his clients assets under management on one bad bet.

How do you go back to your clients and ask them for more millions after that? So hell yeah. it makes sense that hedge funds don't want to quit. They don't want to have to go and be the laughing stock of Wall Street, even the most powerful institutions that are involved with this. Their funds may be more compartmentalized, and they may be able to take a more massive hit on a wide scale because there's just so much money in that institution.

But the heads of these departments that made the bets on Amc that expose so much of that department's capital to losing money, they're going to be going home crying. The boss is going to tell them to pack their bags and go take a damn hike. Why are you working in finance? You should be working in comedy? Okay, just to finish this video, I want to talk a little bit more about a catalyst that's coming this week for Amc. Something called quadruple Witching Now is quadruple witching? A evil witch that comes in and quadruples your count? Well, Unfortunately, not quadruple Witching is almost always an event that has a ton of hype around it and then nothing usually ends up happening.

but something can happen. and that's why we always got to talk about it and make sure you're aware of what it is, because people are definitely going to be talking about it this week. And it's on Friday where this event's actually occurring. So, quadruple witching is a day where a ton of different options and futures expire simultaneously from four different markets With the simultaneous expiration, The idea is that creates a lot of volatility all around, and because of hedge funds and many market makers using options contracts in order to hedge their bets, well, that may make them more likely to execute block trades on Friday, which are massive amounts of trades all at once.

It may be time for them to rebalance some of their assets, and it may be time for them to restructure some of these hedges going into the future and think about what positions they do and don't want to be in, which could indeed induce some volatility for Amc and a lot of underlying stocks. but I wouldn't get too hyped about it. Potential catalyst, but it's probably just going to be another day. The bigger story is the short squeeze story.

Anyways, that caps off the video. If you have any questions, feel free to reach out to us below or join us on Ziptrader Circle and of course Quick Plug if you'd like to learn how to trade. Would like access to our private chat and daily morning briefings where we brief on all the biggest catalysts each and every morning. Well, I'll go ahead and put a link to Zip Trader you below.

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