To: Darrell Re: your question on Intraday price movements
Darrell,
I am addressing this to you as I do not wish to get into arguments regarding this with anyone else. Here is my take on the trading today:
1. The price moved from $29 to $29.875 on 1.4 MM shares in the first 1.5 hours. This was VERY heavy trading for Iomega. There was absolutely no resistance, and very big blocks traded.
At 11 AM EST, the buying started meeting resistance (more sellers stepped up). The price pulled back a little. At 11:20, the selling accelerated. Price went from $29.375 to $28 in less than 54 minutes on 740K shares. This was NOT a lot of volume for a 2 point drop.
From 12:15 PM until 2 PM EST, the price consolidated around $28 +/- $.25. During this consolidation, 2.7 MM shares crossed. However, as you know, 1.6 MM came all at once. So really, only 1 MM crossed and the price stabilized. That's not extremely heavy volume.
After 2 PM, the price went back up to $29 on 700K shares. Again, not a lot of volume.
The heaviest volume of the day came at the open (with the exception of the block).
IMO, there was a concerted effort by short sellers to stall the momentum in the stock. They did not want it to close above $30, as they knew that this would mean a big squeeze for them. While they were successful preventing this, they did absolutely no damage to the stock.
As you know, all along, Iomega has very definite trading patterns. There are a few big players that love this stock. But, they never chase it. They buy up to the point that they have pre-set, and then let the sellers push it back down and start all over. Indicative of setting up a very big position. This pattern has manifest itself every single day over the past 2 months.
Today was no exception. The minute that the big buyers saw the sellers, they pulled their bids. Thus, the dramatic collapse. They bought all the way down to $28. And, they bought a lot of shares!!!
The only thing that this stock lacks in order to really go through the roof is MORE big buyers. Once more of them get interested, the buyers won't have the opportunity to buy on the cheap any longer.
Clic, the 10 MM Zips, and a solid financial performance will bring them in. Also, some decent analysts following the stock would help.
However, don't worry about today IMO. Just a typical Iomega trading day. |
