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Biotech / Medical : Ligand (LGND) Breakout!
LGND 181.45-2.4%3:59 PM EST
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To: okee-boy who wrote (395)1/6/1997 8:33:00 PM
From: Henry Niman   of 32384
 
MMs are market makers. The are the brokers between the buyers
and sellers of a given issue. LGND closed Friday at 15 5/8 bid,
16 ask. The spread frequently widens when volume is low because its
harder to determine an exact price. When the MMs raised the bid to
15 7/8 and kept the ask at 16, that meant that they had plenty of buyers
at 16, but since no one would sell at 15 5/8, they had to raised the bid
to 15 7/8 to find sellers. However, since the buys kept coming in,
they quickly raised the ask to 16 5/8 and raised the bid to 16 1/4.
If MMs look for sellers and can't find any, they end up raising the
price. When the overhang disappeared on heavy volume at the end of Nov,
beginning of Dec, the MMs were ready to rock 'n roll (the price could
move fairly easily on lower volume because there no longer was a
baclog of sell orders - left over from flippers who bought the secondary
at 12 with the intention of quickly selling between 13 and 14).

Henry
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