Okay folks, so I've been paying very, very close attention to certain setups that have been holding up very, very well despite the downward pressure that we've seen from the broader market throughout a lot of this week. As you know, if a setup can hold up very strong or even go up during a day where everything is dropping well, there's probably something big going on underneath the surface there, and one of the big setups that I'm looking at right now is attur. Now for full context before I explain why I like it step by step. Monday morning we briefed on Atra and Zip creator U at about 250ish a share.

because of its increasingly high short interest and retail hype that it had gotten over the weekend had also hit Fintel's top list for short squeezed candidates, all factors that have led many other stocks that we've seen over the last few weeks to go parabolic. And then Monday night on the channel, we went in depth about how the market cap at the previous close was far below the total sales for 2021, as well as the total book value. Market cap as of Friday's close was 144 million. Book value which is assets minus liability was at the same time 226 million.

That means for every dollar you paid at that time, you're basically getting like 1.58 of actual book value. or as short sellers say, a terrible deal and a huge rip-off overvalued Sally, this should be worth zero. A dollar is not a dollar. It's Zero dollars.

But anyways, that inefficiency led to actor jumping from the briefing price at 250ish to 423 by the next pre-market open, which was a pretty solid run almost 70 percent from one pre-market to the next. But usually how do these runs trade? Well, You get a massive, jumpy, jumpy, and then people very quickly take profits usually that day or in the days that come afterwards. Interestingly enough, though, after its peak at 423, it did sell off, but it managed to find support very quickly and at a much higher price as compared to its base starting point. This is very, very rare, especially considering the rest of the market tanked during this time period.

Not only do people take profits after this kind of run, but usually squeeze stocks see their momentum cycles turn into panic cycles when the broader market goes risk off. We saw that with Nile, we saw that with Mullen, and we even saw that with some of the more mainstream ones like Amc and Gme you see either panic selling or short sellers accelerating the momentum downward. But with Atron, what's interesting is that it found support at around 312 and has reattempted an uptrend to higher levels today. and actually as I filmed this video, it actually ran up more into the after hours.

So what does this all mean? Charlie, please can you tell us? Well, outer boy, you're asking the right questions. The retaining power hither tells us that there's a lot of people that think that actor has a lot more run left and that there's more to the story. otherwise they would have just taken all their profits and gone home after Monday and Tuesday, which we've seen with so many other stocks. and then secondly and more importantly, reattempting of upward momentum tells us that either conviction is growing in holders to the extent that they are adding and or add towards attracting capital from completely new buyers.

So you have momentum regaining and a lot more into the after hours. I didn't see that coming when I started filming this video, but they did start running into the after hours and likely as you get the potential for more and more breakouts, you're going to get more and more of that new capital that starts discovering Atar, causing more of a Fomo rally at the later stages. which again is no small feat considering that the overall market has been a leaky boat all week. The setup continues and you actually get a switch of the broader market into risk on.

this. could really go parabolic now. Is there actual value in playing the setup right now? What is the setup? Charlie? Well, we're going to discuss exactly that. After a word from our sponsor, Are you looking for a trading app to trade stocks, options, Adrs and Etfs on worldwide? well consider checking out Moomoo.

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So after setup number one, short interest, Ortex is estimating that 37.27 percent of adders free float is sold short. Number two: Cost to Borrow according to Shortablestocks.com Cost to borrow fees are now as high as 61.90 percent with a range of only three to six thousand shares available to borrow. Per the latest update, this is a significant change from the eight to nine percent fee range we saw back in the beginning of this month and even as late as Monday, and a significant change from the tens of thousands to hundreds of thousands of shares available to short. Now you have much, much higher fees and you only have like 6 000 shares available to borrow.

And if you look at or Texas numbers, the max cost to borrow they are registering is 260 percent and their cost to borrow average registers at 192. So what is cost to Borrow Again, Charlie, and who cares? Well, it's the average annualized percentage that borrowers have to pay on their borrowed shares that they went and sold short or are waiting to sell short but have already borrowed. the higher the cost to borrow, the more that short sellers have to actually make up for that in sheer revenue from their trade in order to still be profitable. and the less margin for error they have.

If I am paying an annualized rate of 3 from my borrowed shares and I see downside in my trade at about 25, Well, I could take my dandy little time because 3 annualized is like less than a quarter of a percent per month. That's a lot of margin for error, but if I'm paying 100 or 200 percent in annualized interest rates, it doesn't turn profitable fast. I could be underwater very very quickly. If you're a short seller and you're paying a hundred plus percent and interest rates annualized, you're thinking, well, if this goes wrong, I'm probably gonna have to go and take my teenage daughters pink Mercedes back to Carmax and she's not gonna be very happy with me.

So why do short sellers take on such high interest rates? Why not just short something different? Well, two reasons number one could be that they have extremely high conviction that the momentum cycle that the stock is experiencing right now is going to end swiftly. Thus, paying really high interest rates for a few days isn't really that big of a deal if you can lock in really strong profits that they see as very, very likely. And if borrow fees are really high, odds are strong that it's because the demand is so ridiculously high, and everybody else in the field agrees with you that it's going to go down very quickly. The second reason though, is if they had already gone very very heavy into shorting the stock at lower valuations and now they're getting more and more red, they can use this opportunity to average up their average short cost while also helping support downward pressure in the stock.

Depending on the power of the short seller, some short sellers will actually save some of their biggest firepower and borrowing power for last just to make sure that they don't lose on a trade. If they dump everything they have very quickly and very rapidly at the last minute, they could freak out a lot of the holders and cause them to panic sell, causing the original short position to return profitable. On the flip side though, and one thing you have to remember with borrow fees is that rates aren't exactly fixed depending on the relationship between the broker and the short seller. Interest rates can be variable quarterly, monthly, weekly, or even daily.

Which means that if you caught an eight percent rate on Monday, well, today, the rates are like 60 plus, so if it gets recalculated, that could completely change your risk profile and cause you to cover early. Borrow fees aren't the most transparent area of the market when it comes down to what hedge funds are getting them at, but net and in effect. We can see what new borrowers are paying and when fees are skyrocketing like they're doing right now and utilization is at near max. Well, it basically means that short sellers are being incredibly stubborn and they have extremely high conviction that the stock must go down soon.

Now, building on that, and what is interesting about the setup is number four: the utilization numbers. according to Ortex, that's at about 100 and it has been for a while. Which means that all shares available to borrow or lend have been borrowed and lent. If you look at other periods of time in the last couple of years where full utilization has been hit, it was hit halfway through the biggest massive rally in early 2021 that took the share price from six-ish to 48 bucks a share.

and then again in the rally that happened at the end of the summer of 21 which took it from 350ish to just under 19 bucks a share. And then obviously once again it's being hit right now now. 100 utilization does not mean that there's no shares available. In fact, like we said earlier, there are some shares that become available intraday, just that they are super expensive and they get lent out almost immediately.

Point is that when utilization is high and near 100 like it is right now, the power of short sellers to resell and resell and resell share after share after share goes down dramatically, which reduces the power of short sellers to actually keep reselling supply to all the new demand. which is why full utilization usually predates some of the biggest runs in stock prices, because there's not as much to hold it down. Now it's worth mentioning though, that in the past, when near full utilization was hit and short sellers needed shares to short, we ended up seeing a ton of failures to deliver afterwards, Which means that short sellers simply sold chairs short without actually having borrowed the shares. Welcome to the Free and fair market folks! to use an analogy, it's sort of like if you're in war and you send out 100 of your troops to a battle and it turns out that you can't win that battle with the troops that you sent out.

but you don't have any troops left. So what do you do when you send out a ghost army of soldiers that don't really exist and then you end up winning the war. And then after you won, the enemy's like, hey, wait a second. Those weren't real soldiers that we were fighting, Those were fake.

Your reinforcements didn't really exist. Does that make any sense to you? Because it sure doesn't make any sense to me. In the real world, invisible and fake soldiers that don't exist don't really do anything. But for some reason in the stock market, we're like, yeah, that that makes sense.

I think that's fair. That's what I have to admit. I always believe that government knows best, government knows what's best for us, and if they think that's fair, that's okay for me. I don't want to be labeled a conspiracy theorist.

Lastly, and this is the real elephant in the room here. This is a stock that was trading at 48.99 in February of last year, but short sellers had no real idea or conviction that this was overvalued at that time when there's a lot more value on the table. They only decided it was overvalued once it had already started taking dramatically 50, 60, and 70 percent. And it didn't stop there.

As its momentum to the downside grew, they started doubling down on it and crushing it more aggressively. Which means now, according to Ortex, we now have more short interest than we have had at any other price. Now, does that make a lot of sense to you? If you think something is overvalued, why are you waiting until it's already lost 90 of its value to really start doubling down on it? Well, the reason is simple because you want to kick it while it's down. That way, your analysis doesn't have to be right.

You just have to pray on something where everybody's already lost hope. Where was the short seller conviction that we're seeing right now? When this was trading at 45, 35, 25, 20 bucks, they didn't have any conviction because they're like, well, what if it goes back up, We don't really know what this is worth. We're just trying to play the trend now. When Atra is on its very last leg, that is a tenth of its all-time high share price.

What happens when short sellers are like, okay, time to bring out all the big guns. Normally if a crowd sells something off 90 plus percent, it's not that big of a stretch to get them to sell it off a couple more bucks and get this de-listed and the ability of this company to raise more capital at decent values, which means you could actually help it go bankrupt and all of a sudden Boom Chuchinga you got all your stock money. The problem though is if somebody else catches on to what you're doing and people are like, hey, wait a second. Now the stock is trading below its buck value assets minus liabilities.

you still have a lot more here than the actual market cap. Hey, this is also a company that the revenue went up like 47 last year, so it's not a dud. it's not dying. What? When that happens, people realize, hey, wait a second.

these short sellers got way way too greedy and now it's time to call their bluffs. Stop it, you bluff and billy. Now in this case, it seems like we're in the middle of a big battlefield right now. But what is giving me hope in terms of the setup is really the fact that we have so much retaining value.

I think if you really want to see this take off into next week, you're going to need to see some strong retaining power continue, but also some of this slight momentum that we've been seeing. We need enough momentum where we get some sort of breakout tomorrow that excites people enough. Where this stock continues getting talked about a lot over the weekend and then similar to what happened after last week. and perhaps we can get a nice spiky spiky on Monday or Tuesday.

You need people to be drawn into it. If it looks like a dead battlefield, people are going to treat it as such. But if it looks like, hey, it's retaining momentum, it's retaining its value and then it's building momentum. On top of that retaining value, Then all of a sudden it's like, well, there could be something big around the corner.

And then you look at how crippled short sellers are right now with the utilization rate and the high cost of borrowing, as well as the rise of overall attention in retail interest and probably some warring hedge funds, Then all of a sudden it's in a situation where this could be an interesting setup into next week. But anyways, folks, we'll see what happens and we will keep you updated in zip trader use daily morning briefings if we see any sort of catalyst pop up for the stock in the pre-market or if we see other stocks with similar setups or other catalysts come up. Some of the other stocks that we've been interested in the last week or so include Sst, which we briefed on the last two days, Spfm, which we briefed on the first time on Tuesday, and also briefed on this morning in the low sevens before it's run to 12 45. pretty insane run overall this week.

And don't tell anyone that I'm looking at this one. Also very much looking at Mnts which just signed a launch agreement with Elon Musk's Spacex. and it's far far below where it was trading at just six months or so. Anything with Elon Musk tends to get a lot of hype and I feel like the run today wasn't sufficient for the amount of hype potential that this catalyst has could be wrong.

but hey, trading is a probability game Anyways, folks that caps off today's video. If you have any questions, feel free to reach out to us below. Thank you again Moomoo for sponsoring us today! Get your up to five free stocks with Moomoo down below and try out an excellent trading app. Also, if you are looking to join you and get one time fee access to our step-by-step lessons, our private chat, our daily morning briefings as well as our full price target list.

I'll go ahead and put a link to it below coupon code never give up expires April 30th and the price will go up after that as well. So if you are interested now might be a good time to give it a look. have a good one and I'll see you in the next video.