⚪ FFIE ⚪ Beware of Extreme Upwards Continuation in January
1. Updates on the Situation:
As I discussed on Sunday, in response to hedge fund margin problems caused by the volatility induced by Roaring Kitty's Christmas tweet - and precisely similar to the effect in May 2024 - hedge funds bought and then promoted their 'go to' ticker, Faraday Future Intelligent Electric Inc. ($FFIE), in order to run up equity. This was extremely important to do, since year-end-accounting was taking place. It was crucial for them to maintain somewhat of a presentable balance sheet which would reflect up to December 31st and show in their annual report for 2024.
Likely routing sell orders to dark, and buy orders to lit in this case, they were able to make $FFIE grow by 255.68% x over just two business days. They then captured some realized equity to reflect on the books and it naturally moved the ticker into a heavy, required retracement on the last trading day of the year.
However, swarms of new accounts appear to be ramping up this game on social media over the New Years Holiday. I'm talking about everywhere the eyes can see: droves of what appear to be international users talking about the bullish fundamentals $FFIE. Many are showing expected January 2025 news of coming ticker change soon to $FFAI, which would 'better reflect' the company's ongoing implementation of Artificial Intelligence into their electric vehicles. And some users actually admire their new, futuristic-looking car called the FF 91 Futurist Alliance. Influencers and Entrepreneurs are taking delivery.
GameStop Corp stock is in a thorough process of melting up. I still, readily-suspect that funds are using $FFIE to allow equity to remain on par with their quickly-rising $GME short liabilities. When consideration is made about funds' liquidity crisis: they may have >100x the amount of '$GME daily liability delta' (the daily change in the liability amount, from their short borrows when GameStop goes up in price) than the amount of '$FFIE equity delta' (the daily change in the amount of equity when $FFIE goes up in price), since GameStop's market cap is 140 times that of Faraday's ($14 Billion versus $100 Million, respectively). Perhaps during acute moments of $GME volatility, such as in the days/weeks after Roaring Kitty tweets, this is why they need to push $FFIE up >100x more than $GME in order to keep up with NSCC's capital requirements equation. This equation sees the quick spike due to the jump in members' daily volatility component and subsequent increase in Value-at-Risk (VaR) tier.
Further, Roaring Kitty just tweeted again (8:00pm EST on 1/1/2025), which means the at-risk funds will need another round of $FFIE.
Unfortunately, I do not believe they are close to being done with pushing $FFIE up. I want to make investors aware of what I see them doing here:
2. Fibonacci Has Spoken:
An ideal Fibonacci retracement to -61.8% of their short-term move up in $FFIE has taken place VERY QUICKLY: in a matter of 2 business hours. I am not sure if I have ever seen something of this magnitude happen so quickly. And the fact that it the rebound took place so precisely off of the -61.8% Fibonacci percentage, is quite alarming to me: it reveals that there will be a natural continuation upwards in the price of $FFIE. This is simply an effect of what they already set in motion.
Like a high-velocity tennis ball bouncing off the floor, the price will technically continue: first towards retesting its $4.50 price from Tuesday, and then it will seek around $10 where some popular moving averages are. After that, I have no idea what could happen, and I can only look to May 2024, when they did the same exact thing to push $FFIE up by 15,000.00% in just a matter of days. I can just imagine a bunch of fund managers laughing about this one, and it irks me.
I also wanted to see what normally happens to this ticker in January:
3. January 2025:
With the New Year, there is already a lot of awareness into what is taking place here. But, the month of January itself happens to be explosive for this ticker as it is: see January 2021 (+100.00%) and January 2023 (+420.00%).
Shown above, January has recently brought upwards movement in $FFIE, most recently by 420.00%
Short Interest
The issue here is that other funds and some other investors had sold $FFIE short prior to this situation. The nominal short interest was about 30% leading into this situation, well before the price rose to $4.50. Additionally, Fintel shows that 1,063,630 shares per day, on average, were Failed to Deliver (FTD) from November 25th to December 13th. This means that the same amount of $FFIE shares per day on average have to be settled, and bought back, every day from January 1st to January 19th. This only adds to the ridiculous buy pressure that is already presenting with this stock at this time.
Monday and Tuesday's volume was heavy for $FFIE, considering it was the beginning of what they normally do with this ticker after Roaring Kitty tweets. But the entire float was traded what looks to be twice in two days. Normally short volume is 50% for this ticker.
Because of these factors, I am now afraid that the funds behind this operation have placed the stock into an 'unavoidable short squeeze' heading into January 2025: the month that is notorious for 'short squeezes'.
You can only imagine hedge fund traders partying about this from their yachts. Irks me every time. The SEC is actually allowing this to occur, since they are actively hiding FTD data and claiming that it is confidential information. That means the SEC is aiding and abetting this operation, because they know the funds need tickers like $FFIE to go up in order to protect them from margin liquification.
4. TLDR:
They already pushed $FFIE up by 255.68% over just two days for equity to offset their GameStop short liabilities. The price was $4.50 on Tuesday. Then, an ideal Fibonacci retracement of -61.8% occurred already in just two business hours. Technicals unfortunately reveal both a coming continuation of the upward action, as well as the month of January itself being uniquely explosive for this $FFIE. Last January for example for $FFIE saw +420.00%. Swarms of bots and international accounts are promoting the ticker over New Years, showing that they are not done with it. Hedge fund traders must be partying about this. Yet, they have also just forced lingering short-sellers of the stock into desperation: with short volume showing about a hundred million shares of short volume in two days. Another million shares per day on average of FTD buybacks of $FFIE, from January 1st until January 19th, only will add to this fiasco. Because of the technicals, the month of January, and the short seller despair here, I am worried that $FFIE will keep going up in what looks to be a crazy and scary situation in the stock market, especially since Roaring Kitty just tweeted again.