At the the time of writing this it is 2am Est February 25. I'm back with another GME post, if you saw my past ones you probably already know what this is going to look like. If you haven't most of them were deleted when the mod stuff happened, so oh well.
The purpose of this post is exploring options and the effect they will have on GME stock. This will not be exploring lack of liquidity, short interest, or fundamentals.
I went through every call option chain and manually counted volume. So all the numbers I use will be rough estimates and expect a margin of error.
To sum up the data there is 65k call options expiring this Friday,that likely will not be relevant unless we see massive price jumps today and early tomorrow. There is 265 in all the other strikes put together. This is 330k volume in total which is absolutely massive. There is volume 65k concentrated in the 800 strikes. 10k of this is for Friday and the other 55k is all the other expirations.(bear in mind I have not factored in puts volume as well, which will have negative effects)
The two scenarios I will present rest on the fact that the squeeze reaches 850 and delta is roughly 100 making dealers need to hedge 100%. Once it reaches this point shit will start to heat up and price movements will be even more volatile.
Scenario 1
Cohen tweets a picture of a rocket ship, price increases 4x in AH and trading tomorrow. This would put price at about 800, dealers become fully hedged and need to have 330 1000 100 = 33,000,000 million shares by this point. This is more than the entire float. They likely already hold 10mil plus, but in this event they would still need to buy more 23,000,000 shares.
Scenario 2
It takes another week for price to rise to the 800 level. All the options from last week expire. This still leaves 265k means that 26,500,000 still need to be hedged. This event is more likely and has a decent chance of happening has along as we get another catalyst.
What does this mean for smooth brained retards? Im sure the autist already see where this is going. The simple version is if we reach 800 we will soar right past 1k and trading will become extremely violent. Price targets of 1k are laughable because if we reach 1k we are going right past it.
Tldr: we break 800 we going to alpha centaria (PT 100K)
Edit fixed numbers