Even with the overall market taking a beating since the FOMC announcement…
The shorts still can’t seem to buy a win.
Yesterday was no exception…as we saw the ticker symbol RNAZ absolutely skyrocket…
Source: StocksToTrade
And while the company did announce a catalyst…
It was something totally unexpected that added gasoline to the fire.
Leading shorts to get absolutely cooked.
Table of Contents
Is A Once-Reliable Market Indicator Now Misleading Traders?
I always tell my students to expect the worst from penny stocks.
These companies will make new press releases to pump their stock price up…and if they succeed…they’ll usually use it as an opportunity to raise cash via a stock offering.
Stock offerings are dilutive…and are almost always seen as negative.
However, there are so many shady brokers…coupled with an oversupply of short sellers…what was once considered super bearish…is now BULLISH.
I know…it makes absolutely no sense…but this is the market we’re in.
Case in point…the ticker symbol RNAZ.
The company announced positive pre-clinical glioblastoma results early in the morning yesterday…
In addition, they issued an S1:
TransCode Therapeutics, Inc.
We are offering 11,479,408 shares of our common stock on a firm commitment basis.
Our common stock is listed on the Nasdaq Capital Market under the symbol “RNAZ.” The last reported sale price of our common stock on the Nasdaq Capital Market on September 21, 2023 was $0.6969 per share. The final public offering price will be determined through negotiation between us and the underwriter; the recent market price used throughout this prospectus may not be indicative of the actual offering price.
Of course, dilution is typically very bearish.
However, it appeared that so many shady brokers over-allocated shares for shorts who wanted borrows. In other words, there would be likely buy-ins coming.
Second, with so many crowded shorts in the symbol, it was easy for this low-float stock to squeeze.
You see, short sellers are relying too much on logic.
Not enough on price action and risk management.
If you’re day trading, then everything doesn’t have to make sense all of the time.
There’s a reason why they call it volatility.
Things can get out of whack for several hours, even days, before normalizing. And that’s something short sellers struggle to comprehend.
Yes, a stock offering is dilutive…but if everyone is shorting a stock that has a float of less than 2M shares…it’s easy to get squeezed.
Stubborn shorts are causing stocks that have no business squeezing to squeeze.
Busy, you MUST learn from this current market environment, shorts saying the $RNAZ spike makes no sense due to upcoming offering, they don't realize it's spiking BECAUSE OF THEM & THE OFFERING! Watch https://t.co/w6jdlcHkvM & see why shorts are the best promoters right now!
— Timothy Sykes (@timothysykes) September 25, 2023
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How I’m Playing These Crazy Short Squeeze Plays
I’ve made an entire video lesson on playing these crazy squeezes.
You can watch it below:
Even seasoned traders get caught off guard in this unpredictable market. Take RNAZ, for example – where conventional indicators painted one story, but the market sang a different tune.
The game has changed, and if you’re relying on old plays, you’re bound to get burned.
I’ve always reminded my students to expect the unexpected with penny stocks. But now, more than ever, understanding the market’s true cues is paramount.
🔥 Shorts are misreading the signs, and stocks with no real reason to spike are skyrocketing.
🔥 What used to signal a ‘sell’ is now a ‘buy,’ and if you’re not clued in, you’re missing out.
🚀 Join me in our upcoming live training sessions this week.
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🚀 Witness real-time analysis, shedding light on unexpected market behaviors.
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Are you ready to move with the market, not against it?
Prepared to decode the penny stock conundrum, even when it defies logic?
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