One Analyst Believes The War Between Retail Investors And Short Sellers Has Already Been Won.

Is it possible that the war between Retail Investors and Short-Sellers has already been won? What a difference 24 hours can make right? Especially when it’s used as a strategic countermove to take the upper hand from your opponents.

Take a look back at the decision by Robinhood Markets to restrict their users for 24 hours and what it could have potentially done for the hedge funds to regain composure.

January 28 — No Retail Buys allowed / Forcing stock prices to drop and offering only liquidation options to Retail Investors.

Same time, Same day: Hedge Funds are allowed to buy GME and AMC freely.

As the stock prices crashed with the forced takedown of GME and AMC, Hedge Funds were allowed to freely enter positions with both companies buying the battered and lower-priced shares as Retail Investors were pushed out and the door was locked.

This allowed for the Hedge Funds to buy up as many of the intentionally “forced down” shares as they desired. GME was in the $112 range for a while and AMC dropped to $6.51 before recovering. So Did the hedge funds take advantage of this?

Here’s what we see today:

Even though the Retail Investors’ have rallied back together and seem to be more determined now more than ever to buy AMC and GME shares, the prices are ranging in levels and peaking as if a systematic sell has been put in place with algorithms. Wait, what’s going on?

Something for Retail Investors to consider:

Before the forced sidelining of Retail Investors yesterday, everyone had their eyes on the short positions of the hedge funds. Is it time to take a second look now to be certain that another bait and switch hasn’t occurred?

Today, As Retail Investors are allowed to trade again, hedge funds are allowing the Retail Investors to push prices up again from the lows, but then it appears that at very specific ranges, they unload some of the cheap shares they bought yesterday when the forced crash was in place.

If hedge funds were buying GME at $112 to $115 a share and AMC at $6.15 to $7.00 a share on January 28, then what we are seeing now may be all part of the plan.

It would be incredibly dubious, but it’s not out of the realm of possibilities. In fact, it would be an obvious play for hedge funds to make in a superior position of allowed purchasing of shares while Retail Investors were locked out.

Their superior position along with anticipating that the Retail Investors would continue their push on the share price once allowed back in seems to offer up a tempting opportunity to recover losses quickly.

Is this the real reason why limited trading has returned the next day?

Today it feels as if they (hedge funds) are allowing Retailers to push the price of GME up to the $350 to $400 ranges, but then release or sell a few hundred thousand shares they bought yesterday (January 28) for $115. It makes sense to do. It would push the price down again, and possibly set off market algorithms to sell as well.

Not to mention that it would easily force a dive into the stop losses triggers of Retail Investors, which is not uncommon for hedge funds to do on a routine basis anyways.

This type of strategy would easily allow hedge funds to recover losses they incurred during the short sell war over the last week, but it would also allow them to keep the price down for days or longer, and potentially even allow them to reclaim their short position, with profits in hand, all in one swoop.

So the question remains. Are the Retail Investors being played once again? The action by Robinhood Markets, Inc. of restricting Retail Investors from buying shares and yet allowing hedge funds to freely continue to purchase shares as they plummeted seemed strategic and it made all of the difference in the world regarding the momentum and in price control.

The one thing we know for certain is that it did provide a 24-hour window of opportunity for hedge funds. Did they use it to gain a superior position and to reclaim the losses they incurred? What do you think?

Share your thoughts with us below.