[hntrader]

This is a conspiracy theory spread on social media. Shorting after it has dropped so much already is an unprofitable strategy. These are cascading liquidations and the valid strategy is to go long when the liquidations stop and you get a relief bounce that squeezes out the novice shorts who chased the move. People have different names for the strategy (wall drop long, parabolic long). Shorts are mostly covering (not initiating) during the drop. The only sophisticated traders adding to a short would be options dealers who need to gamma hedge, or delta one HFTs trying to capture a quick move based on short term order flow imbalance.

[Armisael16]

I think you may need to reread the tweet. He isn’t saying they shorted during the drop; he’s saying they shorted just before they initiated the drop.

It’s obviously profitable to short a stock when you know the value is going to tank in half an hour.

[hntrader]

The tweet is fine and I'm sure many hedge funds and prop firms shorted the initial catalyst. What I'm referring to is the "short ladder" hypothesis mentioned in the parent post which was originally spread on WSB that Justin didn't refer to in the tweet.