Looking at the SPY for the year and we see that the market continues to make lower lows and lower highs.
SPY stock took a big hit on Wednesday during JPOW’s speech, dropping from $405 to as low as $396.
The index closed at $399.40 but continues to be on a downward trend.
Zooming out to the full year and we see the SPY started off in January at $477 per share.
By the end of the first quarter, we see a high of $461 per share and a low of $417 per share.
In June, we see a low of $365 and a peak of $426 by the third quarter of 2022, in August.
This fourth quarter, SPY stock had a low of $348 in October, and a high of $414 in December.
Will The Stock Market Go Up Soon?
Based on the current trend we’re seeing from the S&P 500, it doesn’t seem like the market is ready for a bull run anytime soon.
Buyers failed to break the downward trend as seen in the figure above which means the probability of sellers coming in again is high.
In terms of the economy, inflation is still high at 7.11% and mass layoffs have been seen with DoorDash, Amazon, Facebook (META), Twitter, Netflix, Carvana, and many other companies.
Although JPOW said the U.S economy is currently not in a recession, both Bank of America and Wells Fargo CEOs expect a recession to hit the country during the first quarter of 2023 with some sort of light at the end of the tunnel by Q4.
“While retail payments surged 11% so far this year to nearly $4 trillion, that increase obscures a slowdown that began in recent weeks: November spending rose just 5%,” Bank of America’s CEO Brian Moynihan said.
Wells Fargo CEO Charlie Scharf said, “there is a slowdown happening, there is no question about it. We are expecting a fairly weak economy throughout the entire year (2023).”
If this happens to be the case, today’s bear market may drag out through the majority of the new year.
Leave Your Thoughts Below
Do you see this downtrend in the stock market continuing throughout 2023?
Join the newsletter to become part of an activist group fighting for market transparency!
Receive weekly market news to stay up to date.
The SPY continues to pull the market down
The SPY (S&P 500), which tracks the top 500 companies in the United States continues to pull the market.
Today the SPY is down more than 16% (year-to-date).
On average, the S&P 500 is up 8%-10%.
This is an incredible time to also take advantage of the S&P 500 as it has always set higher levels in the long-term.
However, the SPY is a great indicator of where the markets are going, and we can see AMC is no exception to this market downtrend.
And as the markets tumble, it’s important to concentrate on the opportunities in these conditions.
If you’re part of my private community on the Patreon you’ve seen I’ve been earning 10%-20% gains trading options every week.
This is one way investors may hedge against these market conditions.
The market doesn’t go down forever, eventually it has to come back up so taking advantage of lower stock prices today could bear profits as soon as the market goes into a reversal.
Some of the largest CEOs in the U.S don’t believe this bear market will linger which means at some point short sellers will begin to either take profits, cut losses, or close their positions breaking even.
This is when the markets could see a big reversal.
It’s incredible how much debt is allowed to accumulate in one company. The Evergrande Group owes approximately $300 billion and investors fear it could destabilize China’s financial system.
The massive selloff seen in the Hong Kong markets heavily influenced the New York Stock Exchange. If one of the world’s top economies crumbles, what will happen to the U.S markets, and what will it mean for AMC stock?
Welcome to Franknez.com – I saw some apes in the community wanted to hear my thoughts on how Evergrande could potentially affect AMC stock.
Lets get started!
A Preview to An Economic Downturn
Blood everywhere in the markets, and this seems to only be a preview to what’s coming.
We received a glimpse into the future of the repercussions caused by overleveraged companies.
I think it is safe to say the feds are sweating bullets from this economic trailer.
They’ve been pumping trillions of dollars into the system and loaning overleveraged institutions money that can’t even get paid back.
This disruption has been caused by retail investors creating buying pressure in heavily shorted stocks.
Two of the biggest ‘meme stocks’, AMC and GME, have raised havoc for financial institutions betting against AMC Entertainment and GameStop.
According to insiders within the retail community, TD Ameritrade has never seen this much shorting take place in the history of the markets.
The word is there is no guarantee that the Group will be able to meet its financial obligations, with the company hiring a team of outside advisors.
How Will Evergrande Affect The U.S?
We saw Evergrande’s slip affect the three main indexes in the New York Stock Exchange.
The collapse of the Hong Kong markets would send shockwaves through global financial markets, including the U.S.
Just about every stock and crypto in our markets was significantly down after the Evergrande announcements. We saw massive liquidation in both of these sectors.
If China is unable to step in and protect its economy from financial collapse, the U.S markets will too experience a stock market crash.
Though I think the NYSE is due for one anyway, with or without Evergrande.
The Great Uncovering
Hedge funds in the U.S have been suffering from losses all year due to retail investors buying heavily shorted stocks.
Short sellers have been overleveraging their positions to drive the share price down no matter the costs.
They too have been digging too deep of a hole to close their overleveraged positions.
With billions of short shares borrowed and zero positions closed, hedge funds are a threat to the stock market and U.S economy.
As the market demands for debt to be repaid, hedge funds will need to accommodate to margin requirements by liquidating some or all of their positions.
In doing so, stocks such as AMC and GME will experience major upswings.
A stock market crash could force short sellers to get margin called, where their accounts will be forced to get liquidated if they cannot meet the margin requirements.
Closing out positions in AMC, GME, or any other momentum stock that has been heavily shorted, would cause a short squeeze.
This is why retail investors holding AMC stock or GME stock should not worry about its current volatile share price.
The Share Price Is Psychological
If you’re holding a heavily shorted stock with negative beta, such as AMC or GME stock, chances are they will react the complete opposite to the rest of the market during a stock market crash.
So why was AMC and GME red during the Evergrande announcements? Shouldn’t both these stocks have been green oppose to its counterparts? One thing we have to keep in mind is that hedge funds borrowed more than 4 million short shares to drive the stock price down.
Both of these stocks’ performances were masked by continued shorting and psychological warfare. In theory, stocks with negative beta should have reacted the complete opposite.
We have seen multiple manipulation tactics in the markets to understand that hedge funds will use every resource possible to attack retail investors.
What Will Happen To AMC Stock If The Market Crashes?
Major selloffs from institutions holding AMC stock would take profits, resulting in the share price taking a massive dip.
This is the opportunity seasoned retail investors in the ape community have been waiting for.
Massive buying pressure from the community would pump the price back up and could force shorts to cover their positions once and for all.
The reason I say AMC’s stock price is psychological is because the stock will continue to go down. This could very well be the dip before the rip.
And it will be 100% up to retail investors whether they choose to play offense or not. As for me, I’m taking advantage of the biggest dip yet to add to my position before hedge funds begin covering their positions.
However, follow what your conviction towards the stock tells you. Trey said it best when he says we are all adults and no one can decide what we do with our money but ourselves. “Have a plan.”
Prepare For The Challenge
I’m going to share my real thoughts with you on this short squeeze play with AMC.
I am not selling my AMC stock and I am taking any massive dip that comes our way as an opportunity to increase my position.
It’s really that simple to me. What’s going to be challenging for new retail investors is seeing their investment drop little by little, every day.
What’s prepared me for this challenge is my conviction towards the stock. The data says it all and I don’t mind holding AMC through the winter.
The longer AMC shareholders hold the stock, the more money hedge funds lose.
And although AMC stock could potentially face a steep drop, I know holding my stock is causing short sellers serious damage.
Should You Keep Holding AMC Stock?
When GME began skyrocketing, only a bunch were able to cash in some serious profits. These were the diamond hands who stuck to their convictions.
I can’t tell you to hold, but I can tell you that I’m going to hold.
I personally don’t care what gets thrown my way or about what the people who’ve lost their conviction have to say.
See, at some point short sellers have to cover their positions. Whether that price point is at $40, $30, or even $10, no one knows.
What I do know is that the retail investors who get to experience the MOASS will be those who held AMC stock the day shorts decided to cover.
The heat has been turned up. All eyes are on #KenGriffinLied, Gary Gensler, FINRA, and other regulators.
Financial institutions are calling retail investors conspiracy theorists despite a variety of proof leaked across social media. Transcripts, real messages regarding the manipulation that occurred in the markets preventing investors from buying GameStop and AMC stock are beginning to wake up a sleeping giant.
Retail investors cannot be gaslighted. This attention has reached many finance and business personalities including Charles Payne of FOX Business. And he wants to get Ken Griffin or Vlad Tenev on his show.
Welcome to Franknez.com – the blog that fights to protect retail investors against tyranny. Today I’m calling out regulators.
Let’s get started!
Citadel Securities Denies Allegations
Apes have been raising awareness of the manipulation tactics in the market caused by Citadel Securities, Citadel LLC, and Citadel Connect… yeah it’s the same company.
See, the problem is one branch is a market maker, one is a hedge fund, and the other is a dark pool.
Since Citadel is one of the biggest hedge funds and market makers, it gives retail a massive disadvantage because of how their orders are processed.
One company is shorting AMC and GME stock, the other is creating failure-to-delivers, and the third is hiding buying pressure through dark pool processing and trading.
Financial regulators such as the SEC and FINRA are supposed to be protecting retail investors from this very exact type of manipulation.
The AMC and GameStop community have been looking at Gary Gensler, Chairman and President of the SEC to act. And now, the world is looking too.
“Justice delayed is justice denied”
William E. Gladstone
#KenGriffinLied Files Lawsuit Against Flying Company
The AMC community has been flying banners all year. The community gathered to further spread trending Twitter hashtag “#KenGriffinLied” but was halted from doing so through a law suit.
#KenGriffinLied started trending on Twitter when transcripts of coversations between Citadel and Robinhood insiders took place regarding the halt of trading meme stocks earlier this year.
Ken Griffin under oath said his team had no communication with Robinhood’s team in regards to halting trades. The transcripts show there was communication a day prior to the halts.
More transcripts have come out regarding the communication between Robinhood and Citadel Securities.
Now that you’ve seen the transcripts between Citadel and Robinhood, the transcripts below will make sense. Two Citadel executives confirm the ‘closing only’ positions of AMC, GME, NOK, BB, and NAKD just to name a few.
Robinhood’s COO, Jim Swartwout said in an internal chat “I sold my AMC today. FYI – tomorrow morning we are moving GME to 100% – so you are aware.” This chat is dated from January 26, 2021. Just two days before trading was halted.
Robinhood sold GameStop stock on January 27, 2021 when it was up more than 1200% before halting trading for everyone else. This blatant manipulation has yet to be addressed by Gary Gensler and financial institutions.
When will the SEC step in to protect retail investors?
The halting of ‘meme stocks’ occurred on Thursday, January 28, 2021 and trading resumed on Friday, February 5, 2021.
FINRA Bypassed The Market Manipulation
In another transcript, Citadel Securities Senior Vice President discusses with another Citadel executive on the need to inform FINRA of expectations around a plan for PCO symbols and to expect an increase in complain ‘impact’.
These PCO symbols were AMC, GME, NOK, and BB.
Who Is FINRA?
FINRA is a private American corporation that acts as a self-regulatory organization which regulates member brokerage firms and exchange markets.
Check out what their ‘about’ page says:
“FINRA is authorized by Congress to protect America’s investors by making sure the broker-dealer industry operates fairly and honestly. We oversee more than 624,000 brokers across the country—and analyze billions of daily market events.
We use innovative AI and machine learning technologies to keep a close eye on the market and provide essential support to investors, regulators, policymakers and other stakeholders.”
Regulators portray to the world that their jobs are to protect retail investors and to ensure the integrity of the markets.
However, they have proven to merely be a tool for someone else’s gain. I speculate lobbying.
“Injustice anywhere is a threat to justice everywhere”
Martin Luther King
Who Oversees FINRA?
The SEC oversees FINRA as well as other financial institutions in the market. They are granted the power and authority through congress to make real change happen.
So why isn’t Gary Gensler taking action?
Although we’d like to think the SEC is on the sidelines coming up with solutions, we have not heard from Gary Gensler in regards to the market manipulation that continues to occur with AMC and GameStop.
Mainstream media is finally shedding light on these problems. Now we just need our leaders to begin taking action towards a definitive solution.
News arose today regarding congress raising America’s debt limit to keep the U.S government on. Treasury Secretary Janet Yellen expresses her deepest concerns regarding our economy.
Yellen is currently blowing up on Twitter feeds as she’s stated, “there are issues relating to hedge funds and the possibility of leverage, they can trigger financial runs”..
A financial run is a consecutive run in the markets, whether bullish or bearish. In the case of a hedge fund, it’s usually bearish due to short selling or short-laddering.
Welcome to Franknez.com – today’s finance news will uncover some rather jarring information in regards to our economy. Yellen has warned House Speaker Nancy Pelosi on the matters.
Let’s get started!
Failing To Act Could Spark An Economic Catastrophe
Yet again our government is forced raise America’s debt ceiling or face devastating consequences.
Raising the debt ceiling essentially provides America with a larger line of credit. Yellen’s solution is for America to continue mounting debt, as the treasuries extraordinary measures to print more money could have very well been exhausted.
Although, if congress does not raise the debt ceiling, the treasury would have to step in to keep the federal government running.
Inflation continues to skyrocket with the printing of money. And the only two solutions America has is to either keep digging a debt hole, or exhaust the worth of our dollar.
The lack of financial literacy in our own government is what will ruin our financial system.
How Did We Get Here?
If you ask Robert Kiyosaki, he will say the lack of financial education got America here. And I agree. Robert Kiyosaki, author of Rich Dad, Poor Dad is a strong advocate for financial literacy.
In this incredible interview with Patrick Bet-David, Robert talks to us about his thoughts on the U.S national debt.
If you follow Robert on Twitter, you know his tweets are very strong when it comes to the Feds, our government, and the destruction of our financial systems.
The U.S Will Run Out of Cash By October 18th
Congress has up until Monday, October 18th to raise the national debt before they run out of cash.
“It is imperative that Congress swiftly addresses the debt limit,” Yellen said yesterday in testimony before the U.S. Senate Banking Committee. “If it does not, America would default for the first time in history. The full faith and credit of the United States would be impaired, and our country would likely face a financial crisis and economic recession.”
What Would Happen If America Goes On Default?
If America goes on default, it would trigger a broad market sell-off and put a hold on everything from government payments to the ability to borrow.
Unemployment, child tax, and social security would all stop flowing to the American people. Not to mention, our troops would stop getting paid.
And although social security is a self-funded program, the money is drawn from various trust funds to pay benefits.
Stocks and crypto would tank which would present a buying opportunity for investors. Investors usually profit from these market crashes as they begin to correct themselves. As for hedge funds, closing short positions could result in the MOASS retail investors have been waiting for.
A default would only be temporary, but could hurt Americans who depend on assistance from the government.
The interest rates on credit cards, car loans, and mortgages would also skyrocket, making it almost nearly impossible for struggling families to keep up with occurring debt.
Let’s Talk Solutions For An Economic Downturn
How can we prepare ourselves for an economic downturn? This is not financial advice, but advice from a friend.
If you have money in stocks and crypto, know that with a stock market crash the value of your assets will go down. However, if you take this opportunity to increase your position then you will come out profiting during its correction.
Negative beta stocks such as AMC and GME are more resilient and less volatile when it comes to crashes.
Be sure to have an emergency fund set aside in case you see yourself needing cash short-term. While most of our holdings are in assets, it would be wise to keep cash at hand to prevent from liquidating certain stocks or crypto.
If you have a safe stream(s) of income, make sure you’re stacking. That way when turmoil hits, you’ll be ready to take advantage of the investing opportunities presented to you.
Leave your thoughts below.