Cindicator: Gamestop and other predictions

By bengy | Idle Musings | 29 Jan 2021




Cindicator is an app that I use to partly keep up with the goings on in the crypto and traditional markets. I am one of a multitude of "analysts" who put their opinions and sentiments into the app for inclusion into the predictions engine that they run, and in return, if I make good predictions, I get paid out in CND tokens. It's a nice way to keep up with things that I wouldn't normally spend the time hunting around the internet for... and generally, I do manage to keep a positive balance of predictions for the months and will get a small payout. Not bad for a few minutes of input a day...

Anyway, I'm not totally sure how they are running their tokenomics... at the moment, I don't see that much utility in the CND token, as their AI predictions are only need a single time stake.. they do run a nice altcoin trading bot called Stoic that takes the feeds and predictions from the crypto intelligence, and so far, it has run at a nice profit for me... but on the other hand, it is a crypto bull market, and you would have to try really hard to lose against the USD!

However... all of that is not really in the scope of this particular post. As everyone who is even vaguely connected to the internet knows, this week has all been about WallStreetBets vs the Hedge Funds, and the battles playing out in highly shorted stock like GameStop. So, it wasn't that much of a surprise when some prediction questions came up on Cindicator about some of the battleground stocks!

So, you can see the above chart... where the leveraged shorts are being squeezed by the purchasing and holding of GameStop stocks by the reddit and retail crowd. Seriously, this is an insane chart to see in the regular stock predictions! This is the sort of thing that you might see in a pump and dump scheme in some low cap crypto... A daily wick from around 100 USD to nearly 500 USD!




Anyway, let's just say that I'm really happy that the short-selling hedge funds are getting pounded and being made to lose crazy amounts of money on what their thought was a sure bet in shorting GameStop stocks... even though the fact that they will need to sell longs in other "good" stocks to cover their losses. The stock market is way too detached from the economy, so I have no problem with "good" stocks also taking a bit of a stick as well...

However, I'm not sure that the retail end can keep the pressure up on the hedge funds. Eventually, people will want to take profits... and then there will be rush for the door, this always happens in crypto pump and dump schemes, and this is not likely to be different. Someone poor person will be left holding the bag.

I don't buy into the idea that the trading on Robinhood was manipulated though (no buying, only selling). It sucks that that happened, but I suspect that there is a bit of behind the scenes technical work that explains it. For instance, the Robinhood buyers are not direct buyers of the stock, only contributing to the order flow to the stock purchaser. Then, it is more than likely that the Robinhood accounts suffer a similar problem to the crypto "not your keys..." idea. Their accounts are credited with the stocks, but in practice, their stocks are being repackaged and reloaned... they have an IOU.




Similar ideas for the AMC group as well (the cinema group). They are a decidedly a bad bet at the moment, so the hedge funds shorted the stock... and a similar thing has happened here. Although, it is a much smaller amount.




I suspect a similar thing will happen here... the hedge funds are more disciplined, whereas the reddit crowd are decentralised and chaotic. I think that the morale of the reddit crowd will break first... I wish I was wrong, but I have a feeling that self-preservation and human nature will win out and there will be a rush to not be the last holding the bags at the end of the carnage.




I don't even know what KOSS trades in... headphones apparently? I have no idea why this chart is happening! Likely, the crowd might have seen overexposed shorts and decided to party in here?




It's heartening that the hedge funds are getting smacked around... and also that the stock market is cooling off, albeit a very little bit. The obscene amounts of money that these funds make is just sickening... and the complete divorcing of the stock market and economy, and this "K" shaped recovery is just mind-boggling. It really has got to the point where the people in society who make the most money are definitely the rent-seekers, and the people who ACTUALLY create, make things or make MEANINGFUL contributions to society are being left FAR FAR behind.




Meanwhile, in crypto land... we have a very tame chart. We really live in weird times when the Bitcoin chart is the sane one...




... although, as we speak. Elon Musk has added a #bitcoin tag to his profile... and the price has jumped to over 36k! Sigh, all this money stuff is a bit depressing... necessary but depressing. Although, I'm starting to question the necessity of it all...


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Originally published on my HIVE/STEEM blog!

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I am a Musician (Violinist/Violist) specialising in Early Music living in The Netherlands. I have a background in Mathematics and Physics due to an earlier tertiary level study... and so, I'm still quite interested in Science and Technology related stuff!

Idle Musings
Idle Musings

Shower thoughts about subjects both great and small! Crypto, Society, Governance... What does it mean for Ponies to have Cutie Marks?

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