Everything I can find online about this "ladder short attack" points to the GME activity. Does anybody have any explanation for this that predates the last week? This is not the first short squeeze, nor the first outage for retail traders during a volatile period. The only explanation I see on reddit refers to hedge funds lowering their bids, which isn't sufficient to explain the market actually dropping (there were other buyers out there, and market makers). Anyone can put in a lowball bid but it doesn't matter if it's far off-book.
What does make sense to me is that cutting off a substantial amount of retail flow would reduce buying pressure, causing all market participants to regain at least a little confidence in a reversion to the mean. It just seems pretty tinfoil-hatty to me to view this as some sort of elite cabal, as if RH and Citadel were somehow the only participants who could effect price changes.
During the duration of restricted flow there were 800K shares sold at $120 and $140 in two batches on Thursday, significantly lower than the market price, infact, whoever sold them got sold them at 300M less than market value. This sudden drop caused the price to fall and trigger stop losses. This happened before.
During this period (looks like at least 10:30-noon ET) there were 11 volatility halts (and auction-priced reopenings) due to price movement. The stock spent more time halted than open!
Reopening auctions concentrate trading volumes. This may look more suspicious because volume is so concentrated, but in reality they give about five minutes for many participants to join and it all executes at one price. Prices I see for reopenings are approximately
330
290
265
226
170
140
120
141
170
210
216
The idea that the 120,140 were lower than "market prices" is solidly in tail-wagging-dog category. GME sold off hard, yes, but it was over the course of almost an hour and with substantial trading across the entire price range. This is natural when any imbalanced order flow has previously pushed prices and then subsides.
Note that 120 was the low and prices retraced through about half of the prior range. That retracement started at around 11:20 ET. Do you know when RH or other brokers had opening buy orders blocked and subsequently unblocked? Given that RH needed to secure cash for DTCC'S requirements, I expect that retracement was during the blocked period still.
Overall this still looks like tinfoil hat theory from WSB. Volatility looks crazy and it's easy to see demons in the shadows.
Thank you for linking this. IMHO the reddit thread is useless (I'm looking for older evidence of this term) but the linked post from seekingalpha is from 2014:
The description of a short ladder attack from 2014 strongly implies that the short party is attemping to manipulate a stock from its prevailing fundamental value. There is a key difference in that GME's fundamental value is nowhere near the $300+ range that it was trading it on Thursday!
There need not be a misinformation campaign or "attack" for well-capitalized fundamental traders to see opportunity to sell into this. Especially after seeing the capital crunch nailing retail brokers.
I wondered if it was autocorrect but it's all over reddit too.
As best as I can see, they're saying the price falls if hedge funds decide to lower the bid price. That doesn't make much sense to me, but I'm not (quite) all knowing so...
What does make sense to me is that cutting off a substantial amount of retail flow would reduce buying pressure, causing all market participants to regain at least a little confidence in a reversion to the mean. It just seems pretty tinfoil-hatty to me to view this as some sort of elite cabal, as if RH and Citadel were somehow the only participants who could effect price changes.