$ARKK Are the Short Ganging Up On Cathie Woods?- Video and Transcript
On November 22, 2021 stocks $ARKK, $SPX, $NDX, $VIX, $IWM, and $SKLZ were being shorter. There is speculation that these stocks are being targeted because of Cathie Woods. Turbo Trading's Head Trader, Robert Knight, MBA shares his thoughts on the matter. A transcript is below the video.
The question came up, in the chat room about $ARKK, Cathie Woods, this is her ETF. She's the main advisor for it. And the fact that some of the big houses, Citadel being the main one big short house, are actively shorting $ARKK now. So do they have a personal vendetta against Cathie Woods? Are they trying to knock her for ETF down? Or the stocks that are in the ETF down so that people will take their money out of that, perhaps put it with them. They can talk about how they, shorted her stocks and how well they did. And so come join them. Maybe could be, but, let's have a look at the overall market first.
We have a negative divergence right now between the $SPX, this is the Standard & Poors 500 look at how strong this is. This is traded to all-time, new highs today. And the $IWM, which is the mid-cap and small-cap. This is really, I mean, it did break out of this huge basing pattern traded up to $245 now rolled over. So there's a big divergence between the big cap stocks, the mega caps. Stocks like $NDX. I mean, look how strong that is. It's an engulfing bearish bar today, but a huge bullish move. The $VIX here is at $18, which is still bullish, it’s under 20. That's bullish. Now it's come off a double bottom here. So the $VIX stocks are very strong. But the $IWM, which is representative of the Russell 2000 has been weakened. We know that a lot of these stocks are getting hammered.
Personally, I don't think that Citadel and the other big boys are ganging up on Cathie Woods, per se. They're looking at the stocks that she's holding and they're shorting them because they think that, you know, they were overvalued. A lot of them, a lot of these stocks, you know, perhaps got overvalued. And what may be setting them up is, the retailers, the retail traders, investors follow Cathie Woods, but they don't buy art. They just buy certain stocks that she has.
But, you know, but when this got up to resistance area, then you know what I mean? You don't have to be Citadel to short it. You can look at it and say, okay, I'm going to go short the stock and down it comes, you know, they buy it at $21, they sell it at $26.27. Now backing off.
$SKLZ. I mean, this was another one of hers. I mean, it looked good. We put a swing on this. I thought it was had changed directions, but it's backing off. So is it backing off because Citadel shorting it or is it backing off because $IWM the Russell 2000 is softer?
I mean, the $ARKK is breaking down, but it's an ETF. So it's unlikely that they are affecting the price of the ETF. In the sense that because they're shorting it, then they're knocking it down. It's an ETF, so it has a book value and it'll trade at some relationship to that book value.
If it gets oversold, then the buyers would come in and buy it up. So the $ARKK itself, they may be short, but they're short because the chart looks weak. And the $IWM is pulling back. And this $ARKK has a lot of high volatility, highly speculative stocks. And so, you know, they're bound to sell off with the markets.
And so, you know they're shorted, just like they're short, any stock. Or $RIVN, I mean, look how this came off, this has zero cell sales and it traded to $180 from the $74, you know, up 1.5 times from the opening now has come way back. Were they shorting that stock? Probably. You know, big, short positions on it, who wouldn’t. Lots of guys said they were shorting it when I got up into this area and not after the fact. Not saying ‘oh yeah, I shorted that at $170’ they were vocal about shorting it up here. So in my opinion, the big boys aren’t trying to destroy. Cathie Woods, what they're trying to do, or what they're doing is they're shorting stocks that get overvalued.
Now it might be because the retail traders see that she in the past, was buying those stocks. So they would jump in and drive the price up and get it out of whack. Then the big boys would short it because not because it's Catherine Woods, but the short it, because the chart is overvalued and therefore, susceptible, vulnerable to a pullback and you can go short.
So, she'll have her day in the sun again, and then the stocks will go. But for now, the stocks that she is focusing on are under a lot of pressure and so ripe for, you know, the big boys to short.
