Nickileaks + TSLA Dojo... we're pumping to infinity

The lizards are doing the most American thing imaginable… a vicious hulk pump to the stratosphere.

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RIGD REPORT
September 11, 2023

Good morning RIGD.

Today is 9/11. The markets should be closed but they’re not.

Instead the lizards are doing the most American thing imaginable… a vicious hulk pump to the stratosphere.

We called it yesterday.

It’s turning into a perfect storm of sorts; one part Nickileaks, one part Tesla.

Let’s explain.

Nickileaks pump

Nick Timiraos is the chief economics correspondent for the WSJ and effectively known as “Nickileaks”. Basically when the Fed wants to tell the world something and can’t do it directly (we don’t know why these guys are allowed to give so many press conferences), they use Nickileaks to whisper it out to the markets.

So while the markets were closed and we were in Church praying for a profitable NFL season, Nickileaks dropped a bomb.

Inflation is rapidly declining and a September rate pause was all the lizards needed to pump SPY +0.43% and QQQ +0.63% in the pre-market.

On Wednesday before the open we get CPI + Core (inflation ex food and fuel) inflation reports. It’s weird to push this article if the reports are bad… but maybe the lizards want to run this thing up before a dump.

The fed prefers the core inflation metric which is inflation minus food and fuel due to their volatility. That’s probably good because oil is up 29.27% in the last three months.

Tesla “Dojo” Chip 6x Nvidia A100 GPU 😭

You fight fire with fire and if you want to pump harder than the PhD in Pumpanomics (Jensen Huang Nvidia CEO), than you make up some ridiculous shit and put it in a presentation with a Morgan Stanley label slapped to it while conveniently forgetting that Tesla never launches anything on time and the production Cybertruck looks nothing like the concept and one of them even had duct tape attached to front bumper.

Who cares it’s all in the game right?

The direct response copywriter bros got nothing on Adam Jonas.

Look at this hyperbolic cliche word salad…

“mother of all AI projects”

“solve for autonomy” (how’s self driving going btw?)

“pushes new boundaries”

“asymmetric advantage”

“$10 TRILLION TAM”

jfc

Truly an incredible piece of work by the lizards.

We especially appreciated the headline rhyme Tesla’s AI Mojo Enter the Dojo.

No bullshit that’s fantastic… memes are the baseline for ideas to spread.

What is it?

Teslas “are sensor encrusted robots making life and death decisions in highly unpredictable environments and situations.”

Their next-gen proprietary brain will be the Dojo chip, being developed in-house by Tesla for the specific purpose of ingesting lots of data.

“A problem that generative-AI and ML [machine learning] training systems are facing is that the advancement of hardware is well behind the software,” Morgan Stanley explains.

“Tesla’s solution to this problem is developing their own innovative hardware structure, piece-by-piece, to provide the ideal architecture to run Tesla’s computations. The Dojo hardware was developed to accelerate itself without relying on an outboard device, as each chip is its own supercomputer.”

We didn’t understand that either but basically it’s an AI ASIC chip a single purpose supercomputer like one of them ugly bitcoin miners that will be 6x faster than the NVDA A100 GPU and much cheaper.

They also used our favorite term: "flywheel” and applied it to automated driving and Saas.

Amazing stuff.

Price upgrade:

$TSLA upgraded to overweight with baseline price target of $400 and a bull case valuation of $550.

Which from Friday’s close would represent increases of 60.97% and 121.33%.

RIGD report:

Traditional finance love to shit on crypto for being zero substance pure hype valueless vaporware and while they’re absolutely correct in that regard, where do they think they learned it from?

The “Dojo” is still in development, every other bigtech company is making their own specialized AI chips and Tesla has never shipped anything on time in the history of their company.

Ultimately it is what it is and it ain’t what it ain’t. This is how the lizards run the market and it’s better to adapt and catch the pumps (make money) than worrying about being right.

Summary:

The lizards sent Nickileaks out to tell the market the Fed is pausing in September.

The lizards got the pause news and deployed pumptesla.exe with Mojo Dojo.

The lizards will continue to win.

CBOE Study: August 15 SPX Sell-Off (RIGD 🎯)

On August 15th from 3:00 - 3:30 the SPX index falls 0.4% from 4451 - 4433.

It’s a massive move in a short period of time.

And of course… RIGD perfectly tagged the event.

Why did it happen?

There have been a number of back and fourth arguments over the cause.

Goldman Sachs says it was demand for 0DTE puts that lead market makers (lizards) to hedge their exposure leading to the drop.

CBOE says no.

The Chicago Board Options Exchange (CBOE) is the largest U.S. options exchange and the grand-daddy of 0DTE.

On Friday they released a new paper on the impact of SPX 0DTE options on volatility specifically referencing the August 15 selloff.

You can read it here or continue with our summary and low IQ translation.

If we look at net gamma exposure across all strikes on Aug. 15, we see that market makers were long about $2bn gamma at 3pm when the sell-off started – meaning that they would have been hedging in the opposite direction of the market move, potentially dampening rather than exacerbating the sell-off.

While the short gamma exposure did increase going into the close, the SPX index actually stabilized during that time, which is the opposite of what you’d expect if 0DTE gamma hedging was a meaningful driver of the index price action.

Low IQ Explainer:

Long gamma = lizards do the opposite to stabilize the level.

ex: If lizards are long gamma for the SPY 451c and the price hits $451.05 then to remain market neutral they will need to hedge by selling the underlying.

Short gamma = lizards follow the move

ex: if the lizards are short gamma for the SPY 452c and the price hits $451.95 then to remain market neutral they will hedge by buying the underlying.

In the August 15th example, dealers (lizards) were long gamma going into the sell-off, so theoretically they should have been buying the SPX to hedge.

It wasn’t until the sell-off was over at 3:30 that lizards were short gamma and would need to sell to remain neutral.

Overall tracking gamma for 0DTE is kind of just meh.

Every other tool out there has some sort of GEX (gamma exposure) tracker. We don’t put a huge emphasis on dealer gamma because it’s a lot like technical analysis, it works great when the price hits the line you drew or when price moves to the GEX magnet (largest negative value), but it’s not the best indicator for intraday moves.

As you’ll see we still tagged the sell-off with a perfect pin.

RIGD tags the move 3 minutes before the sell-off

At 14:57 RIGD sends an alert for a 387 score BEAR BOMB for the SPY 444p.

A mere three minutes before move!

We flagged the 444p at 0.41 which went for a maximum gain of 300.74% in approximately 53 minutes.

The return if you held until the end of the session was 158.23%.

RIGD BRAIN:

It’s incredible to see the lizards argue over the cause of the drop, meanwhile RIGD is in the corner doing dabs with a perfect tag prior to the move.

These are the moves you want to catch and like many of the most profitable swings… it shouldn’t feel good.

Going short into the close with an hour left in the session????

But as know… always fade your intuition!

Hopefully we get some great alerts today.

We’re excited to see what $TSLA being up +6.38% in the pre-market will do for us when we open up.

Going to be an insane day and we can’t wait to get after it!

Have a great one and remember to always…

STAY FROSTY!

P.S. BOBs and BATs should go live today (alpha day one test in prod).

Does this sound fun to you?

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