Hank Returns.... WITH SOME FTD CYCLE DD
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| Author       | Source       | 
| :-------------: |:-------------:|
|  [u/HomeDepotHank69](https://www.reddit.com/user/HomeDepotHank69/) | [Reddit](https://www.reddit.com/r/Superstonk/comments/myxei0/hank_returns_with_some_ftd_cycle_dd/) | 

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[DD 👨‍🔬](https://www.reddit.com/r/Superstonk/search?q=flair_name%3A%22DD%20%F0%9F%91%A8%E2%80%8D%F0%9F%94%AC%22&restrict_sr=1)

*************I am not a financial advisor, this is not financial advice*************

A post-shack salute from Uncle Hank

Oh boy have I missed you, my Apes. I come to you as a primate reborn. I haven't shaved, showered, or talked to my dad in four months... yeah this 3-day sabbatical really took a toll on me. After taking my sabbatical where I only drank WD40 and coconut oil, only ate pringles, fig newtons, gushers, and Cheetos, only listened to Fifth Harmony, Megan Thee Stallion, and Linkin Park, only used the bathroom ONCE per day, and only called my wife's boyfriend for 45 minutes per day (thank god that's over, I need my 8 hours), I come to you as an enlightened primate. Now reporting, HomeDepotHank69, the orangutan:

[![r/Superstonk - Hank Returns.... WITH SOME FTD CYCLE DD](https://preview.redd.it/m41j8f9pniv61.png?width=1336&format=png&auto=webp&s=fd0e25ae64c4b0209cd24cdc9c0b6441869cde82)](https://preview.redd.it/m41j8f9pniv61.png?width=1336&format=png&auto=webp&s=fd0e25ae64c4b0209cd24cdc9c0b6441869cde82)

Yes Apes, through my time locked in my shed I smoked many crayons. I went to the depths of the internet to find information. After scouring Reddit and seeing other posts from you beautiful apes, after spending a strangely long time on federal websites looking for statutes, and after waiting 55 FUCKING MINUTES FOR A SINGLE SANDWICH FROM FUCKING JIMMY JOHNS, I come to you as an orangutan with one thing:

[![r/Superstonk - Hank Returns.... WITH SOME FTD CYCLE DD](https://preview.redd.it/eqj23ejgoiv61.png?width=798&format=png&auto=webp&s=76a8c537407b33380cb9a05504e875eb196eb31e)](https://preview.redd.it/eqj23ejgoiv61.png?width=798&format=png&auto=webp&s=76a8c537407b33380cb9a05504e875eb196eb31e)

History

If you've seen my Magnum Opus posts, skip to the part where I say your meat smells good

Apes, before I get started I wanted to give you a quick run-through of my recent GME posts. Over the past week or so I posted a series of DDs that I dubbed my "magnum opus" where I used past price and volume data of GME to try to predict where it might go in the future. I found some STARK similarities between early January and now as well as some similarities between mid-late 2020 and the post-squeeze period. However, as many of you know, the theory did not pan out. Many of you still think that my theory may be correct but just off by a few days (we will have to see). However, I could not shake the glaring similarities that I saw in price action. So, if it wasn't price similarities, it had to be something else, which is why I come to you today with this research. Finally, before summarizing I just wanted to again thank all of you for the great response to my posts. I absolutely love doing this and the positive reaction that I've gotten from comments, awards, messages, etc. has been overwhelmingly wonderful. You apes are the best (even the ones who called me retarded, which I take as a compliment so suck it). Alright, so here is a summary of my Magnum Opus theory and how it was wrong. Essentially, I took a very detailed look into the price action and volume of GME from these time frames and found similarities that I believed I saw in the charts. My goal was to use the blue square to predict where we would go after the green square based on volume, price, and potential catalysts. Here is a macro view of that:

[![r/Superstonk - Hank Returns.... WITH SOME FTD CYCLE DD](https://preview.redd.it/gm85oymfpiv61.png?width=1352&format=png&auto=webp&s=82420b702d82fd9dff6c84053a9a3fdf8d0f0642)](https://preview.redd.it/gm85oymfpiv61.png?width=1352&format=png&auto=webp&s=82420b702d82fd9dff6c84053a9a3fdf8d0f0642)

I then got into a super microperspective and believed that I had found an exact similarity between GME from the week of January 11th to last week. Many people had a good reaction to this and seemed to agree; however, the theory did not come to fruition and I acknowledged that. Here is the week view:

[![r/Superstonk - Hank Returns.... WITH SOME FTD CYCLE DD](https://preview.redd.it/vts0pkgdpiv61.png?width=1166&format=png&auto=webp&s=7f9fec4afbe48176517c223ec56cf2fa711921b1)](https://preview.redd.it/vts0pkgdpiv61.png?width=1166&format=png&auto=webp&s=7f9fec4afbe48176517c223ec56cf2fa711921b1)

That was a serious understatement of how in-depth I went in that DD, so if you are interested in learning more about the past how it's still similar but not exact to today, I'd encourage you to look at my Magnum Opus posts (again, the prediction was wrong but I still think the theory that GME is repeating its past price action due to FTDs is correct, which I will detail below):

[Post 1](https://www.reddit.com/r/Superstonk/comments/mtf4e4/gme_magnum_opus_dd_past_present_future/) [Post 2](https://www.reddit.com/r/Superstonk/comments/mu1esp/gme_magnum_opus_update_theory_confirmation_today/) [Post 3](https://www.reddit.com/r/Superstonk/comments/muoepo/gme_magnum_opus_theory_round_3/) [Post 4](https://www.reddit.com/r/Superstonk/comments/mvdk5a/gme_magnum_opus_update_the_day_of_reckoning/) [Post 5](https://www.reddit.com/r/Superstonk/comments/mvo75j/urgent_dd_update_from_hank_ftd_time/)

Alright apes, it's time.

HOW DID I GET HERE? (YOUR MEAT SMELLS GOOD)

[![r/Superstonk - Hank Returns.... WITH SOME FTD CYCLE DD](https://preview.redd.it/hdkqyscvoiv61.png?width=468&format=png&auto=webp&s=32ffd80452aceb4cb4a2529086cf84578337ac66)](https://preview.redd.it/hdkqyscvoiv61.png?width=468&format=png&auto=webp&s=32ffd80452aceb4cb4a2529086cf84578337ac66)

FYI that's not actually me

Many of you are probably thinking that I'm going in too deep on this, that you could find a correlation like this with any stock, and that I'm just a retard (which is true), and that is definitely a fair point. However, the reason why I believe that there is more than ~~meets~~ meats the eye with GME is because of how strange its price movement is:

It is not normal for a stock double in the span of a few hours on news of a CFO getting fired (2/24). It is not normal for a stock to open at above 250, go to 350 before noon and then fall down to 172 all before 2pm on absolutely no news (3/10). It is not normal for a stock to tank on earnings and then literally make back those losses the very next day on absolutely no news (3/25). It is not normal for a stock to double on news of the CFO being ousted but to go down 5% on news that the key player (Cohen) is being announced as the god of the board of directors. It is not normal for a stock to stay above $150 when every Wallstreet analyst says it's not worth more than $50. It is not normal for a stock to have a negative beta. It is not normal for a stock to fluctuate in value by 10x over the span of a few months (up AND down) on very little fundamental news. It is not normal for multiple forums talking about the same stock to be infiltrated repeatedly by suspicious accounts trying to create FUD (i.e. shills really on exist on forums discussing GME, not regular retail investing forums like [r/investing](https://www.reddit.com/r/investing/) and [r/stocks](https://www.reddit.com/r/stocks/) (which I am banned from hahahaha)). It is not normal for a stock to be universally hated by mainstream finance yet still be trading over 3x what they believe the fair value to be. It is not normal for a stock to get squeezed, fall back down, then almost regain its squeeze price on no fundamental news. I could go on and on.

In short, THE GAME STOP CHART IS STILL NOT NORMAL BY ANY STRETCH OF THE IMAGINATION BY ANY METRIC WHATSOEVER. Therefore, the only logical conclusion is that there is some form of manipulation/trickery/abnormality going on about this stock, because, again THIS DOES NOT HAPPEN TO NORMAL STOCKS. Yes, the squeeze was abnormal and everyone recognizes that, but what's even more striking to me is the post-squeeze activity. Did anyone (other than DFV) really think that GME would almost reclaim its squeeze highs less than 2 months later? NOPE. What strikes me, even more, is how strangely GME reacts to catalysts. As we all know GME doubled on the announcement of their CEO being ousted but went down when Cohen was announced as Czar of the board (full disclosure, I thought this is what would send us to the moon). Therefore, because of the sheer abnormality of GME as a stock, my thesis, like many of yours, is that something fishy is still happening with GME. When I kept seeing these abnormalities, I kept taking a look at a longer view chart and couldn't escape the feeling that the chart looked like it was repeating on some level, but when I dove deeper I couldn't discern what it was.

As many of you know, I did a deep dive into technicals and tried to predict GME's movement. Well, I was wrong, and I made sure to let all of you know. Before doing this, I did a plethora of technical DD on WSB. Though some of that panned out, most of it didn't. I also did fundamental DD (see my April similarities post), which also didn't pan out. So as you can tell, apes, I like to research and I like to research thoroughly. I seek the truth and will tell you if/when I am wrong. In doing all of this research for the past few months, I couldn't shake the feeling that there was still some pattern that I just wasn't seeing. After a plethora of apes reached out to me (most to give me information and thank me and some to call me retarded), I had to do more digging. The only thing that I really didn't understand was this whole FTD cycle/squeeze thing. It seemed distant to me and almost dark. Since fundamentals, technicals, and normal patterns seemed to be out the window, I came to the conclusion that I needed to look at something deeper because it's clear that something deeper is going on. The only things that I could think of were genuine criminal manipulation (which none of us have the resources to prove, so I quickly threw that out the window) and this stuff about FTDs.

Apes, as a technical trader who lives and dies by the chart. As a trader who has the letter R.S.I. tattooed on my left butt cheek. As a trader whose wedding vows said "til MACD has a negative convergence" instead of "til death do us part." As a trader who TTM SQUEEZES his meat to on-balance volume charts, it is with a heavy heart that I say.... Technical indicators officially DO NOT MATTER for GME. You can check my post history, I have been trying for months to find patterns using technicals, indicators, studies, etc. and none of them come true. That's because this is a game being manipulated by FTDs and naked shorts, and Guncle Hank has found the fucking sauce. It's spaghetti time bitches.

So, why FTDs? FTDs are at the heart of abusive shorting, which most of us believe GME is the victim of. Shorting is what got GME into this mess in the first place and because it appears that there is still fuckery afoot, I believe that shorts are still the answer and that there is more to uncover. And THAT is where FTDs come in. So, my beautiful apes, this is the culmination of my days in the shed drinking WD40, smoking crayons, and listening to "Work from home" by fifth harmony a disturbing number of times.

A quick note about shills

Here is the official HomeDepotHank69 response to the recent influx of shill activity:

[![r/Superstonk - Hank Returns.... WITH SOME FTD CYCLE DD](https://preview.redd.it/xn6ff3m7oiv61.png?width=850&format=png&auto=webp&s=4e870ea865d9b39415523eb7c856e494215477ca)](https://preview.redd.it/xn6ff3m7oiv61.png?width=850&format=png&auto=webp&s=4e870ea865d9b39415523eb7c856e494215477ca)

BOOM. Problem solved

No seriously, fuck shills. Be careful of these creatures.

Outline

Before I start, I just wanted to say that this, again, is just my opinion and is just a theory. I could very well be wrong. I have been wrong in the past. Do your own DD and come to your own conclusions before making any decisions. As per last time, I will tell you all if I believe I am wrong. This post will go over my FTD cycle theory focusing on why it occurs in the number of days that it does, how synthetic longs and monthly options play into it, and how the progression of it affects HFs the longer they stay in this game. Finally, I have created an obnoxiously long analogy that summarizes where I currently think we are and where we still have to go.

1\. Hank is not naked: FTDs and Naked Shorts

By now, you have all probably seen the hundreds of posts on Reddit about FTDs and naked shorts. I am not going to explain this because the information is already out there and it would take far too long. Instead, I am going to list the important topics for you to search on your own in case you aren't up to speed on GME: shorting, naked shorting, settlement dates, FTDs, synthetic longs, ETF/operational shorting. If you aren't up to speed on these, just look through this sub and the gme sub and you should be all good!

2\. Pants off: The FTD cycle

In the past week, there's been a ton of talk about the 19-21ish day cycle that people are seeing in GME. The reason that I made this post is because I believe that my magnum opus series conclusion (GME is repeating its past price action) was correct, but my reasoning (just because of price and volume) was incorrect. Instead, it's based on FTD cycles. So, if you look at GME's chart there is an extremely predictable pattern where every 19-21 days there is a significant spike in price and volume. I've seen several versions of this, some where the 19-21 day period starts the day after monthly options expiry and others where it is just a 19-21 day period regardless of options expiry. I personally do not think that this distinction really matters because no matter how you draw it the lines are always a few days before or after the options expiry, they are never in the middle of them. For the most part, every chart that I've seen marks the relevant days of significant increase, so we're all saying the same thing, there just might be a variance by a day or two depending on how you draw it. Here's my chart:

[![r/Superstonk - Hank Returns.... WITH SOME FTD CYCLE DD](https://preview.redd.it/v17wk5w5oiv61.png?width=2208&format=png&auto=webp&s=0257359f79acd7c21044ee9c5bdb64693ced0f5d)](https://preview.redd.it/v17wk5w5oiv61.png?width=2208&format=png&auto=webp&s=0257359f79acd7c21044ee9c5bdb64693ced0f5d)

You'll notice that each line is accompanied by a substantial increase in volume on the positive side (green). The line all the way to the right hasn't happened... YET. This chart probably looks like most of the charts you've seen on this trend. Now, here's something you probably haven't seen:

[![r/Superstonk - Hank Returns.... WITH SOME FTD CYCLE DD](https://preview.redd.it/f4ilbzy4oiv61.png?width=1518&format=png&auto=webp&s=07589745b91ae52f6e4dd9850b2bfac87bd7d780)](https://preview.redd.it/f4ilbzy4oiv61.png?width=1518&format=png&auto=webp&s=07589745b91ae52f6e4dd9850b2bfac87bd7d780)

This is the exact same chart but using a log scale (changes the scale so that larger and smaller numbers on the scale have the same available room on the chart). As you can see, I made dots, which give us an indication of where each of these FTD cycle values lies in relation to each other. What I gather from this is that the trend is linear. Yes, the January number kind of breaks the trend but I attribute that to media attention and the squeeze distorting (in our favor) the value of that FTD period, so I drew an arrow on where it probably would've been if not for the January squeeze. This, IMO, is the most important chart. What this shows us is that the price for the shorts to stay in the game is increasingly linearly each FTD cycle period. Though the price moves up and down seemingly unpredictably, the price that shorts are having to pay at the end of each FTD cycle is increasing substantially.

Why the 19-21 days specifically?

So, in my final post on my magnum opus DD, I posed the question about why this 19-21 day pattern keeps repeating itself. I had a feeling it was FTDs and so did many others but I couldn't find a reason why. Well, I've found that reason and it's not random. According to [SEC regulation SHO](https://www.sec.gov/investor/pubs/regsho.htm), market makers have special privileges regarding FTDs when related to "bona fide market-making activity." As we all know, the SEC is the strictest governmental agency and enforces all of its restrictions to a tee (sarcasm). Brokers are allowed T+13 days to merely locate the aforementioned share that they shorted. HOWEVER, they can satisfy the locate requirement with YET ANOTHER borrowed share, which will follow a T+6 settlement. So, let's do some calculus here, apes. 13+6 = 19. Each T represents 1 day. 1+1+19=21. BOOM. 21 day period. Now, you may be thinking, "why are some of these periods 19 days and others are 21 days?" That's because these T+13 and T+6 requirements are the latest possible days that settlement must occur. They could still fulfill delivery before this requirement; however, for their purposes, it makes the most sense to kick the can down the road as long as possible. If they don't deliver on the settlement date, they cannot short any more stocks for a period of time. So, now you understand the FTD cycle period that we have been seeing. BUT I'M NOT DONE YET.

Options complicate it further

So, what can make the above FTD cycle 10x worse? Yep, that's right, options. As we all know, the shorts have been attempting to hide/delay FTDs using synthetic longs (ITM calls) as stock replacement. Remember what I said earlier about every single one of these periods beginning/ending extremely close to monthly options settlement days (usually a few days after)? Here's what happens: They short a stock. They naked short the stock. They use borrowed shares to cover borrowed shares, which makes their short position bigger. They "cover" borrowed shares/naked shorts with synthetic longs (ITM calls). However, those synthetic longs expire at the end of each month (it doesn't make sense to buy longer-dated calls cuz it's more expensive), so they have to buy more synthetic longs right after expiry or the 20-day rule will kick in and they won't be able to short anymore and will have fines. Because they buy ITM calls, other MMs buy shares to delta hedge, which makes the price go up more. The period between monthly options expires is extremely volatile in both directions; however, the trend of the price at the end of each monthly expiry is up. Therefore, each month it gets more and more expensive for them to keep this up. At this point, their short position is so elaborate that they are in too deep to quit and so they must continue this. It is only a matter of time before they run out of resources and are margin called.

This is why hodl is so important. Literally, the only way for HFs to win is if people lose interest in GME and sell. This will allow the shorts to bring the price down and slowly unwind their position. However, if apes simply continue to hodl, the shorts lose more and more resources every single FTD period until they are literally forced to cover. They are in so deep that they can't get out because they've literally been covering naked shorts with borrowed shares and digging themselves in a deeper hole. Why do you think large financial institutions have been making all of these new rules and liquidity requirements? The people who work there simply have more resources than us and probably saw this coming sooner, so now they are bracing for the impact. They aren't getting squeezed out of their positions, they're slowly bleeding out of them and when it's too much they'll get squeezed. I have an entire hypothetical with examples below to highlight all of these points.

From what I can tell, this pattern has been going on for about a year, but the volume really started to pick up in September:

[![r/Superstonk - Hank Returns.... WITH SOME FTD CYCLE DD](https://preview.redd.it/59b6ks73oiv61.png?width=2220&format=png&auto=webp&s=465f9c5ba0247da0ef4c931ce9492da25f1b3284)](https://preview.redd.it/59b6ks73oiv61.png?width=2220&format=png&auto=webp&s=465f9c5ba0247da0ef4c931ce9492da25f1b3284)

I'm guessing that the shorts started using a significant amount of naked shorts in March/April when there was a huge possibility that GME would go bankrupt. Their thinking was probably, "yeah using naked shorts is riskier, but it will make the chances of GME going bankrupt much higher. And what's the worst that's gonna happen?" *sad violin plays in the background*. Then when there was a mini squeeze in April due to Hestia Capital urging a share recall (check out my DD on that) and the price almost tripled, they started getting more worried. Then when the price wouldn't go down below the $6 level they got really nervous and started abusively shorting thinking that at worst they'd only lose a few mil. LMAOOOOOOOOOO. Because of that, they are now in an absolutely disgusting FTD cycle that they cannot escape because they keep piling on naked shares to replace the old ones.

The position that they're in is even further complicated because it is the definition of a Catch-22. If they don't buy more synthetic longs and cover with borrowed shares at the end of every cycle, then the SEC doesn't allow them to short anymore (I'm guessing they also get fined). So their options are: don't cover and allow the price to rise because of no downward pressure, or cover, which makes the price rise and keeps you in this cycle. It's a lose-lose for them either way.

Another interesting thing that I noticed is that, after perusing through DFVs updates, I've noticed that he seems to double down right around the time of these FTD cycles (usually a little bit before the next one starts). This guy's knowledge of this is so deep, I wouldn't be surprised if he's been ahead of all of us for months/years now on this topic.

[![r/Superstonk - Hank Returns.... WITH SOME FTD CYCLE DD](https://preview.redd.it/zcea9bs1oiv61.png?width=299&format=png&auto=webp&s=14b8e90d31ce5bfc20f7c4691828c194e3f6837c)](https://preview.redd.it/zcea9bs1oiv61.png?width=299&format=png&auto=webp&s=14b8e90d31ce5bfc20f7c4691828c194e3f6837c)

Yes, apes, there's more. I went even further into the data. I downloaded the price and volume history of GME from Yahoo Finance and put it into an excel spreadsheet. I then ran some formulas on it and did some conditional formatting so that it would highlight certain values. I found that about 2 days before the start/end of every period there is a day that is between -1% to 1% in price change on extremely low volume. Many of you pointed out that GME has done this the last few times before jumping, so I dug further and found this, which struck me as very odd because it even did this in the face of high volume periods. So, what does this mean? Honestly, I'm not entirely sure. It could be a complete coincidence. One possible explanation is that shorts try to stabilize the price on these days to ensure that they can get a good price when they have to buy into the next FTD cycle but idk if that makes sense. I wanna hear what the comments have to say about this one.

Moreover, there's a whole other dimension to this, which is the abusive shorting taking place regarding ETFs containing GME. I don't want to get into that here because it will take far too long and because there was some near-perfect DD from these beautiful apes: [u/augrr](https://www.reddit.com/u/augrr/) and [u/turdfurg23](https://www.reddit.com/u/turdfurg23/)

I'd encourage you to check out those posts as they do a great job of explaining that, which only adds to our case. Moreover, there is also a new OCC rule being put in place soon that could limit synthetic longs (I'll try to get more on that, but if you are up to date on it please say so in the comments!)

[![r/Superstonk - Hank Returns.... WITH SOME FTD CYCLE DD](https://preview.redd.it/98w4b5h0oiv61.png?width=1241&format=png&auto=webp&s=63a6adf20931bc3680547001c5a643ec877f431c)](https://preview.redd.it/98w4b5h0oiv61.png?width=1241&format=png&auto=webp&s=63a6adf20931bc3680547001c5a643ec877f431c)

Still not convinced? As I said before, many posts like this in the sub sound like conspiracies until you consider this: Why is the price above $150? Almost every single analyst has the stock valued at no higher than $50. And when it was at $50 after the squeeze, why did it DOUBLE on very little fundamental news (most stocks only double if a merger is confirmed, GME doubled on news the CFO was out). If GME would've stayed in the $40-50 range from after the squeeze until now, then all of these theories would be pretty farfetched. But the fact that AFTER THE SQUEEZE the stock went all the way back to $350, has stayed above $150 for months, and is insanely volatile on very little fundamental news should be sufficient to show you that this whole situation is not over and that there's still fuckery afoot. Again - THIS IS NOT NORMAL.

3\. The most important paragraph in this DD

There are many DDs that say similar things to this involving periods revolving around FTD cycles and price increases. Some of these DDs are identical. Others are very similar and others are different. Some say that the FTD period is X days while others say it's Y days. Some say it's based on option expiry, others say it's just random, others say it's based on ETFs. HOWEVER, all of them have one crucial thing in common, which is the most important thing for you to get from this DD: HFs are TRAPPED in an FTD cycle and are using every trick in the book to reset/delay the FTDs. The only way for them to get out of it is for apes to lose interest and sell the stock. This cycle gets more and more expensive for them as time goes on and eventually the cost will outweigh their resources and they will be forced out through margin calls.

4\. What's next

Apes, I direct your attention back to that original FTD cycle chart that I showed you above. As you can see, the yellow line that is the farthest to the right seems like it's coming up very soon. That's because it is. Depending on how you draw the lines, the next FTD cycle should be starting/ending sometime between April 26-28. This would make sense because we've seen volume being absolutely piss-poor for the past few weeks and it's in line with the 19-21 day cycle. Ik I said that technicals don't really apply to GME anymore but I couldn't resist pointing out that the big fat wedge also seems to be approaching its apex. If we see some significant volume and upwards price action early next week, then I think that this theory has some serious potential. I will warn you, however, as I said in my last posts that a prediction coming true does not confirm the theory, it simply doesn't confirm that it is incorrect. Again, all of this is just my opinion based on what I see and yes, I could easily be wrong again.

Now, let's say that we do see a significant increase in price and volume in the next few days. FIRST, if you have to ask yourself "is this GME moon?" then it probably hasn't mooned. The mooning will be blatantly obvious, pointy, and sexy as hell.

So, if it does happen, then the next target is obvious: digging deeper into the numbers to find the real FTDs. My next project will involve attempting to find an estimate of the true number of FTDs or naked shares by using metrics like FTD data, ITM call history, shares traded compared to shares in circulation (to try to estimate the presence of synthetic shares being traded), ETF shorts, etc. By using these metrics I will try to reverse calculate what the FTDs should be by comparing these numbers. Obviously, I haven't started that and it's just a plan right now but I invite other apes to come along for the ride with me just as many of you did for this one! The reason I want to start trying to find that actual FTDs or naked shorts is because exposing that would give GME the media attention that it needs for more volume and more tendies. If we can reasonably establish that the FTD cycle theory has a high probability of being correct, then we have yet another advantage on these shorts. Remember, always follow the money. Essentially, my goal in the future is to prove what we all already know: THIS CHART IS FUCKING WRONG AS SHIT:

[![r/Superstonk - Hank Returns.... WITH SOME FTD CYCLE DD](https://preview.redd.it/cdehir9yniv61.png?width=2406&format=png&auto=webp&s=ddaf1fa534183ce31fae4a8fd7cf68122ba9cdb3)](https://preview.redd.it/cdehir9yniv61.png?width=2406&format=png&auto=webp&s=ddaf1fa534183ce31fae4a8fd7cf68122ba9cdb3)

5\. ANALogy and calculus

This is a long analogy! Get ready

So let's say that there's a hypothetical hedge fund called Abusively Shorting Stocks Inc. (ASS). Surprisingly, ASS loves to short stocks. ASS finds a stock with a high probability of going bankrupt. ASS opens a short position. So far, the short position is making bank. THEN, a global pandemic hits, which almost destroys the company and makes ASS's short position even more profitable. ASS now believes that the company will definitely go bankrupt. ASS decides to turn up the pressure hoping to make the company go bankrupt so it doesn't have to cover. Because of this belief ASS is willing to be riskier because it thinks that at worst it will break even if by some miracle the stock goes up. ASS has special privileges because it is a market maker. ASS takes advantage of these rules and starts using naked shorts to apply more pressure to the stock. ASS knows that if for some reason the stock shoots up, this could bankrupt ASS, but ASS's risk models say that this is next to impossible.

Let's say for argument's sake that ASS's original short position was 1,000 shares (arbitrary number). These shares were shorted the typical way: borrow, locate, pay fee, cover when you please. Because the stock is going down, ASS is making tons of money because the difference outweighs the cost to borrow.

Remember above when ASS realized the company was on the brink of bankruptcy and wanted to accelerate that so it did some riskier things? Well, ASS has now decided to add 1,000 more naked shares into its position. Now, ASS must cover the 1,000 shares it originally shorted, must cover the 1,000 naked shorts, and must deliver the 1,000 shares that it didn't actually own but sold to people through the naked shorts. However, because the company is still going down, ASS is still making money. If ASS is correct, when the company goes bankrupt, ASS won't have to cover any of the now 3,000 shares that it is obligated to return because the company is defunct. So, ASS just applied 3x the downward pressure on the stock and still won't have to pay it back if their plan works. To further get around these FTD requirements, ASS uses ITM calls to mask its true exposure so it doesn't have to actually buy the shares.

So, everything is going well for ASS. Their ramping up of pressure will most definitely bankrupt the company, they will soon make bank. The FTDs will not unravel because there will be no shares to deliver. Then, throughout the course of mid-late 2020, very unexpected and positive news happens for the company on a financial and leadership level. The stock rises a lot. ASS is in trouble. Now it's LOSING money. ASS could do what a responsible firm would do and just take the L, but no. ASS delivers its FTDs with more borrowed shares. ASS started out with a 1,000 obligation and turned it into a 3,000 share obligation. NOW, it delivers those 3,000 shares by borrowing more shares or using a synthetic long to reset the cycle. However, this doesn't change the number of shares that ASS is obligated to deliver, it just delays it. ASS continues to pelt out more naked shorts, which applies more downward pressure on the stock but puts ASS in an even bigger HOLE that grows exponentially larger over time. For every 1 naked short that ASS takes out, it is obligated to repay/deliver 2 shares. Then, because of media coverage, celebrity tweets, and a few whales, the stock squeezes in January. Many of ASS's rivals are squeezed out and have to cover, but not ASS! ASS gets a brokerage to stop the buying but not selling of the stock (because that will definitely fix the brokerage's "liquidity issue"), which eliminates all buying pressure and increases selling pressure. ASS pours in even more shorts and shorts it all the way down to under $50. ASS has really made some money. It could probably even unwind out of its position and maybe even end up slightly positive. Nope. It keeps piling in shorts because its ego won't let it cover. Though ass may not be losing money anymore in February, it has gone even deeper into the cycle.

ASS is in a strange position where its obligations to deliver shares are basically infinite at this point but because it just keeps covering its obligations with borrowed shares and synthetic longs, it's not dying like it should. However, because of continued interest in the stock and SEC regulations that force ASS to cover every 20ish days, it has to put buying pressure on the stock every 20ish days, which causes the price to go up. On top of this, ASS has to keep rebuying options for it's synthetic longs when they expire, which further drives up the price. In between those 20 days, ASS continues to apply downward pressure hoping that it can drive the price down by the next 20 day period when it has to cover. This is all fine right now because ASS is a very wealthy fund. ASS is in so deep right now, however, that it can't unwind its position because the sheer number of obligations that it has at the current price exceeds its resources. ASS really wishes that it covered in February when it had the chance! ASS is now forced to stay in this dangerous game hoping that it can get the price down to a level where it can slowly unwind its position. Therefore, ASS is now playing the waiting game; it's trying to kick the can down the road, make people lose interest, and then swoop in and cover when the stock goes down to a lower price. ASS believes that this will be difficult and long but will work.

Sadly for ASS, however, every 20ish days the cover price goes up, which makes it more expensive for ASS to stay in this game. Every 20 days ASS slowly loses more and more resources until it gets to a point where it can no longer afford to cover the linearly increasing cost to cover every 20ish day period. ASS's only option is to keep doubling down hoping that it can outlast the apes. I wonder if that's gonna work? It doesn't. Eventually, ASS runs out of resources, gets margin called, covers what it can after liquidating its assets, and the stock goes to the moon.

That was the analogy from the perspective of ASS. Here's the analogy from the perspective of some primates. A group of apes is playing Jenga slightly differently. It's the same rules except the apes only lose if the tower doesn't fall and ASS gets margin called once the tower falls. Every FTD cycle represents an ape removing a block. The apes know that every time they remove a block, the tower gets more unstable and that the eventual fall will be much greater as each block is removed. The only thing that the apes don't know is WHEN the tower will fall, they just know that it WILL fall. BUT how can the apes lose this game? There's only one way. If the apes get bored, give up, and literally stop playing the game, then the tower doesn't fall and ASS wins. THAT'S THE ONLY WAY. The apes just must continue playing the game because the longer they are in it, the more pressure that is applied and the bigger the eventual payoff will be. HORRAY FOR METAPHORS.

Now, let's take this metaphor one step further. The apes are playing this game, they aren't losing interest. They are dialed in. But then BOOOOOOOOOM. An earthquake hits and the tower comes crashing down quicker than the apes expected. This earthquake is a whale. So, if apes keep playing the game, they will win eventually, but if a whale unexpectedly comes in, then the game is expedited for the apes. How could that happen? Another squeeze would do it. How would that happen? More media attention, celebrity tweets, etc. just like in January. Importantly, this is not necessary, it would just make it faster.

[![r/Superstonk - Hank Returns.... WITH SOME FTD CYCLE DD](https://preview.redd.it/lv8rnkptniv61.png?width=692&format=png&auto=webp&s=784ca348bf09de0248def1c537b097b2abc753f1)](https://preview.redd.it/lv8rnkptniv61.png?width=692&format=png&auto=webp&s=784ca348bf09de0248def1c537b097b2abc753f1)

Conclusion

Apes, it's all right in front of us. Just look at that linear FTD cycle line of pain. It's getting worse and worse. As many of us have said, the moon will probably come out of nowhere and none of us will expect it. I couldn't agree more because these FTD cycles show us predictable patterns of increased pain, but we will never be able to know when they finally decide to throw in the towel or when a whale comes in to throw the towel in for them. As per the charts that I have shown and the charts of many other Redditors in the past few days, the next FTD cycle increase should be coming very soon. It could literally be today, it could be tomorrow, it could be Wednesday. However, it could come later than usual as HFs use more tricky tactics to throw us off. However, these FTD cycles are getting worse and worse for them. It's important to remember that the next FTD cycle jump is probably not moon day, it's just a continuation of the linear line. You will know when the moon happens, cuz it'll be nasty.

With that, I give you my dearest and most relevant, "*Stay strong, Apes.*"

TL;DR

There is a very predictable pattern of price and volume spikes about every 19-21 days on the chart of GME that is based on naked shorts being forced to cover due to SEC regulations. Every time they recover with more naked shorts, they are making it worse, which is why the price of these periods is increasingly predictably and linearly. The only way for this to stop is for people to lose interest in GME, which is why they are kicking the can down the road. By simplying hodling, more pressure is applied as it allows the cycle to continue. Eventually, the pressure will be too much and the naked shorts will unravel.

Reemphasizing the most important point mentioned above:

"There are many DDs that say similar things to this involving periods revolving around FTD cycles and price increases. Some of these DDs are identical. Others are very similar and others are different. Some say that the FTD period is X days while others say it's Y days. Some say it's based on option expiry, others say it's just random, others say it's based on ETFs. HOWEVER, all of them have one crucial thing in common, which is the most important thing for you to get from this DD: HFs are TRAPPED in an FTD cycle and are using every trick in the book to reset/delay the FTDs. The only way for them to get out of it is for apes to lose interest and sell the stock. This cycle gets more and more expensive for them as time goes on and eventually the cost will outweigh their resources and they will be forced out through margin calls."

The Greatest TL;DR of all time

Apes, I know that many of you can only comprehend through pictures, so I made a TL;DR about this whole situation using a popular anime:

[![r/Superstonk - Hank Returns.... WITH SOME FTD CYCLE DD](https://preview.redd.it/kjxpiipvniv61.png?width=1940&format=png&auto=webp&s=291a7fafd31eac2c039b0e06ab9219067a90a623)](https://preview.redd.it/kjxpiipvniv61.png?width=1940&format=png&auto=webp&s=291a7fafd31eac2c039b0e06ab9219067a90a623)

*************I am not a financial advisor, this is not financial advice*************
