So heres the deal, a large chunk of investors have been trading on dark pools for some time now. There is now, more than ever before, an extreme imbalance in trading due to order flow volumes.
For example: Lets say you sell 10,000 shares of NVDA today. You take a tidy profit, all is well.
But you did this through a broker which takes that order, and sends it to citadel. It has no immediate impact on the market. It just sits at citadel for now.
In the meantime, citadel holds back on selling this to the main market. Citadel paid you, you got your gains. But nvda will continue to rise as citadel holds those shares.
And then a bunch of other people sell, and citadel holds those shares too.
Price keeps going up – things are great. Economy seems to be having its best run ever.
Then, on one fateful day, somone takes a very high leverage position within the dark pool, creating an oppertunity for citadel to take a profit against it.
Now citadel has a reason to offload. And so it does. It sells off all those shares of NVDA, and thus, they take the profit on not only the shares..
This worked so well in other countries that similar institutions, such as jane street, have been banned from trading in some of them for quite litterally causing the entire market to crash when they decide to offload against leverage.
This is about to happen here too. Its why there seems to be such a large disconnect between what the market is valued at and what its really worth. Its just funny how no one goes "look at nvda its worth 5.7 trillion" and thinks for a second theres a problem. Do you realize how much money that is?
It may sound like fear mongering to the extreme, but lets just put it this way, the damage is already done. If youve bought shares in anything over the past 3 years, thats going to be a loss very soon. Citadel and jane street are about to inherit this entire economy and the market is going the levels we saw it at in 2021.
The real bubble is simply a knowledge gap
byu/Thebaxxxx instocks
Posted by Thebaxxxx
4 Comments
I thought it was my turn to post the market is crashing bullshit thesis today?
Do you have a date or is it just in the future?
lol so you are saying Nvidia is going down by like 94% starting on monday?
it could happen, but it’s very unlikely