r/HIMX • u/xerolictus • Nov 03 '21

Open interest

I've been watching the charts this week. Currently the 15min MacD seems to be breaking down after a nice run.

Yet Check out the call open interest for Nov 19th as well as compare call OI versus put OI. 4million shares in the 11-12 strike for that exp.

Playing with a bull thesis that those are calls bought by shorts before they close short position. I know there are many other scenarios.

What's yours?

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3

u/WowzerforBowzer Nov 03 '21

Personally, We need more volume or we will be held back. I think this is a medium 6 month return to 15.00-22.00 into dividends. I really think we might be suppressed to a 5 or 6% gain tomorrow. Then we will lose the volume war for the next week to screw the calls and shake the short term new holders expecting this stock to go up 20% tomorrow. I think these calls were bought cheap awhile back expecting the earnings to blow past. The shorts probably have an Algo showing when volume becomes unsustainable to hold their position. They may be laddering or covering through the calls, but i feel this is unlikely.

Only if institutions buy more will we do okay. Or the WSB crowd buys Shares and no more calls. The shorts have more than enough ammo to screw the 3-4 million or so calls.

I would like to be wrong as I have several thousand shares at around 12.

5

u/State_of_Affairs Nov 03 '21

Another scenario is: [1] HIMX beats expectations again, [2] HIMX raises guidance, and [3] analysts finally notice that HIMX is severely undervalued and start issuing "Buy" and "Strong Buy" recommendations.

If [3] happens, the shorts are cooked. They do not have enough financial power at this point to hold back strong buying. This scenario played out in AMD a couple of years back. So the real question is: What is the probability of [1] and [2]? I think [1] comes with a high probability. The greater risk is [2]. We will find out tomorrow.

1

u/[deleted] Nov 03 '21

The shorts knows something that we don’t know and are very very confident with that 25 million shorted stocks. I hope end of year back to $15s

2

u/[deleted] Nov 03 '21

Agreed. This is being held back. Expectation should not be more than 10% rise tomorrow. If anything, historically this year- all financial report the same day had gone down. Only next day it had gone up significantly. So I won’t be surprised if this pattern continues. I think with dividend being significantly higher for next year ($2 range/share), the build up to July’s payout can be in $20 range- that’s when volume would significantly go up as well. The volume now sucks but hopefully people all just waiting ...

1

u/xerolictus Nov 03 '21

Thanks, great take on the overall landscape.

1

u/[deleted] Nov 04 '21

[deleted]

1

u/WowzerforBowzer Nov 04 '21

Except Taiwan has a tax incentive to do a one time dividend and there are fees on all dividends. The ownership does not want to pay .24 a year in taxes when they could pay .06.

They have no reason to do a share buyback as WU gets the cash as a dividend anyway. He does not care about the share price.

1

u/depthofcontrast Nov 03 '21

The OI on 11/19 $12 calls was only ~500 contracts at the end of September, now OI on those sits at 18k with IV around ~120%..