Lockdowns....do NOT flip! READ:
Okay, this one is by Monk, who DEFINITELY knows about lockdowns. Read, comprehend, then, HOLD!!
the Float Lock Down Concept…why it works…and what can slow it down…
A Float Lock Down is created by researching companies that have positive cash flow and sound fundamentals...and, of course the most important factor… a favorable share structure.
Once, the company is located and researched…and all due diligence is complete, our team begins to lock down the float. We purchase shares on the open market and continue to accumulate the shares till the float is owned in entirety.
Market Makers are tasked with creating an orderly market…this works to the benefit of the Float Lock Down process in that in order to create the market they are literally forced to short shares in order to keep liquidity for those continuing to purchase the shares of the chosen company.
As the float continues to be shorted, Market Makers are placed in a precarious situation, in that; they have been forced to short the stock of the company thereby creating the opportunity for our team to continue to buy shares. Once the float is owned completely by our team, this forces the Market makers to sell what is commonly referred to as “air shares”. Since no shares of the float are available for purchase, the Market Makers will continue to short the stock and reach a point where covering the shorted shares literally reaches a critical mass, typically the float plus 65%, for example…if the float is 100 Million shares, the Market Makers would be forced to cover at a point when the shares sold total 165 million.
This process by definition creates a “Short Squeeze”, whereby the covering in and of itself is self-fulfilling. The Market Makers are forced to buy the shorted shares back on the open market and this obligation allows for our team to control the attainable share price by exercising discipline and only releasing shares that are held by the team in a stair step manner as the short covering progresses.
A previous example of a successful Float Lock Down would be EVC@ where in our team took the company from a level of cents to a top share price of $7.75. In this example, the stock traded millions of shares per day during the cover in monetary amounts exceeding $50 million per day during the peak…
So what can deter the time in which it takes to reach the aforementioned critical mass…?
That’s an easy answer…when folks on the team or those that follow the plays decide to unlock the float. This happens by certain folks flipping the shares as we reach newer highs. A good example is that of CDIV. While CDIV remains “mostly” locked…we cannot quite reach the critical mass as “team” or “follower” shares get released when we reach newer highs...whether this is because some folks simply can’t resist taking some off the table as we reach those highs. For some folks, when CDIV reached the recent highs in the .60’s and .70’s, it was literally more money than some had ever seen and they simply couldn’t resist taking advantage of it.
When a large holder releases shares...especially, at the bid, it can lead to others, whether they be large or smaller holders into thinking that it may be the top…and then they follow suit releasing additional shares. If it happens at a quick pace, it is as though someone yells fire in a crowded theater. Based on the chart this is exactly what happened with CDI@. Shortly after CDI@ reached its recent high there were several days that followed where the bid was repeatedly hit. This forces weaker hands to take their shares off the table and forces stronger longs to absorb those shares… This simply rearranges the float into other hands...yet, does not force any movement higher by the MM’s.
Yes, this keeps the float locked...although into fewer and fewer hands. I can’t tell you how many times myself and others have come in and brought a couple hundred thousand bucks in to various stocks within an hour and yet there always seems to be shares there for us to buy. While I have no problem continuing to accumulate, nor do other core longs, it does not help grow the team. The goal is for as many of us as possible to accumulate shares to be ready for the squeeze.
When the team and followers all get on the same page, our Float Lock Downs will squeeze. Until then, we will continue to fluctuate and cycle just like any normal stock being played as though it is a usual chart play…I could point to precise examples on XXXXXXXXXXXXXXXXXXXXXXX
Again, the goal is to work as a team, this will make all the pieces come together. If you want to flip plays or play channels…I would recommend trading FAS and FAZ or other ETF’s, they provide ample opportunity for flipping in the range of 3% to 10% daily.
Float Lock Downs are not designed to be trading plays…we simply accumulate the float and add on any weakness. If the team can all follow the same game plan, then we can force short squeezes as often as we like…
