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Dug into $ASTS short interest: ~65M sh short (~25% of free float). About 1/3 is convert-arb hedging against $3.8B of converts - mechanical, not a bet. Net ~23M sh after capped-call dealer longs. The other ~40M is directional. Know which seller you're fighting.
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The kicker: long-dated, high-vol converts have almost no gamma. Deltas are ~0.8 already. A $1 rally forces only ~100K sh of arb selling vs ~18M daily volume. "Every pop gets sold" isn't bond math. It's directional shorts pressing. And they're the squeeze fuel above.
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Conclusion: $ASTS stays heavy on drift — the directional shorts have a wide exit door (~3.5 days to cover) and no reason to hurry. But there's no hedge cushion under a real catalyst. This doesn't rally its way out. It gaps up. Position for the gap, not the grind. JMHO, NFA.
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Joe O'Neill retweeted
Thank you Germany 🇩🇪 and UK 🇬🇧 for heroically sacrificing your economy to save the planet 💪
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Joe O'Neill retweeted
Robin Williams explaining how golf was invented remains one of the greatest stand-up bits ever recorded
internet archiva
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Joe O'Neill retweeted
⚠️ The adjusted $SPY / $IWM ratio is printing a major reversal candlestick after tagging the Dotcom Bubble peak (depicted by the red line in the chart).
It's very likely that this ratio has peaked and is about to form a supercycle rollover. We may be at the start of what will ultimately prove to be years of large-cap underperformance relative to small-cap.
This does not necessarily mean that the Russell 2000 will rally from here on out, instead it's a warning that the large and mega-cap stocks that comprise the #SPY have a lot to lose in the coming liquidity crisis -- even more than already hard-hit small-cap stocks.
#SPX / $SPY / $SPX / #IWM / #RUT / #smallcap
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