I've been patient with AMC in the last of couple days with over $100k invested @$19. I'm starting see a familiar pattern with CLOV. I see a similar pattern with AMC's second day of rise and CLOV's behavior today. With an initial spike, both of these stocks all started with a high pre-market price and a cooldown throughout the day. Eventually, AMC showed this pattern for a day or two until it shot up for the last time before the short squeeze began. CLOV is still at an infant phase of a massive potential squeeze. The shorts are putting on pressure to keep CLOV low, but the counter pressure from retail investors are holding the stock and not give into the panic. Holding the line for a day or two will accumulate more retail investors, who are buying these dips. If CLOV is the next short squeeze play, it will surpass AMC in a heartbeat.
CLOV is a gamble play for sure. There is always a probability of short squeeze happening depending on many factors, like media and sentiment. However, CLOV was my next pick because the numbers showed me that it definitely had a massive squeeze potential, and I saw a familiar resemblance with AMC. High risk high reward.
If CLOV plays out like how AMC did, CLOV will close today with the resistance around $17~$18 range. The next morning, CLOV will see a massive spike during the pre-market and cooling off for a bit throughout the day. Then CLOV would've stabilized around $20 and the shorts will start to get impatient. They will have to cover their shorts because they are not seeing CLOV going down anywhere close to $7~8 again in the next couple of days. Thus, the short squeeze will begin. Once it begins, more retail investors will join in. With the options expiring on the 18th, more people will join in seeing a potential gamma squeeze. I can see this stock go to an unimaginable numbers if the pattern continues.
This is a domino effect play. The first step has to be completed before moving onto the next. I believe that the first step is already completed, and we are at the second step, fighting against bearish sentiment. Third step is the squeeze. Fourth step is wait for the squeeze to stabilize, and the last step is to cash out the profit.
This is purely my personal opinions and not a financial advice. Seeing how big the wallstreetbets community is, a pattern like this is likely to happen again. At the end of the day, retail investors don't change their behaviors over night because we are not under any management or any strategy. The pattern will repeat.
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