Meme Market Mania

The entire stock market has become a meme stock. [Jeff Clark's Market Minute]( Meme Market Mania By Jeff Clark, editor, Market Minute The entire stock market has become a meme stock. You remember the meme stock craze in 2021, don’t you? Back then, the Reddit-crowd of retail investors would buy far-out-of-the-money call options on stocks like GME, AMC, and BBBYQ. Market makers would willingly sell the options to the retail investors. They were happy to collect the premium. Recommended Link [Do You Bank in Any of these 110 Banks?]( [image]( [These 110 banks]( have enrolled in a controversial pilot program that could have drastic implications for your money. If your bank is on this list, you’ll need to move your cash before July 26… or risk your entire life savings. [Click here to see the full list.]( -- But in order to offset the risk of being short calls, the market makers would buy shares of the underlying stock – thereby making a “delta-neutral” trade, a trade that is not dependent on direction but profits as time passes and the option premiums decay. As more and more retail investors bought calls, market makers had to buy more stock in order to offset the risk of being short calls. This buying pressure – in the absence of natural sellers of the stocks – forced the stocks higher. The higher stock prices brought in more call buyers, which then forced market makers to buy more of the underlying stocks, which brought in even more call buyers – and on and on. This is a gamma-squeeze. And, it continues until folks stop buying call options and/or enough natural sellers of the stocks show up and pressure the price lower. Then it all unwinds in spectacular fashion. Gamestop (GME), for example, lost about 80% of its value in just one week in early February 2021. AMC Entertainment (AMC) dropped 70%. Bed Bath & Beyond (BBBYQ) lost 60%. Like I said, this happens on individual stocks all the time. Now though, it seems the entire stock market is being gamma-squeezed. Free Trading Resources Have you checked out Jeff's free trading resources on his website? It contains a selection of special reports, training videos, and a full trading glossary to help kickstart your trading career – at zero cost to you. Just [click here]( to check it out. Folks have been buying large amounts of out-of-the-money call options on the market indexes (SPX and QQQ mostly). Market makers who are selling those calls need to buy the underlying indexes in order to neutralize their short call positions. That buying pressure – in the absence of natural sellers – is pushing the indexes higher. This doesn’t happen if there is a bearish counter force. But, the bears have been run over so badly the past several weeks that no one is shorting. No one is selling. So, the market squeezes higher. How long can this keep going? I have no idea. All I know is that when it stops, the market will unwind in spectacular fashion. Be careful out there. Best regards and good trading, [Signature] Jeff Clark READER MAILBAG What do you think of the meme stock market mania? Let us know your thoughts – and any questions you have – at feedback@jeffclarktrader.com. IN CASE YOU MISSED IT… [In 20 years, this little-known trader didn’t have a single losing year…]( In his video, Market Wizard Larry Benedict reveals how to make all the money you need, in any market, using a single stock. [Click here to watch the video]( and get the name and ticker of the one stock that could put you on the road to financial success. [Click here to learn more.]( [image]( [Jeff Clark's Market Minute]( Jeff Clark Trader 55 NE 5th Avenue, Delray Beach, FL 33483 [www.jeffclarktrader.com]( To ensure our emails continue reaching your inbox, please [add our email address]( to your address book. This editorial email containing advertisements was sent to {EMAIL} because you subscribed to this service. To stop receiving these emails, click [here](. Jeff Clark Trader welcomes your feedback and questions. But please note: The law prohibits us from giving personalized advice. To contact Customer Service, call toll free Domestic/International: 1-800-752-0820, Mon–Fri, 9am–7pm ET, or email us [here](mailto:contactus@jeffclarktrader.com). © 2023 Omnia Research, LLC. All rights reserved. Any reproduction, copying, or redistribution of our content, in whole or in part, is prohibited without written permission from Omnia Research, LLC. [Privacy Policy]( | [Terms of Use](