Thanks, Raleigh.
Four of the first five trades were buys but until 2:37, it was 7.1k shares bought at the offer and 26.6k sold at the bid. We had a little undertow at 12-1 when there were 7 sells in a row and then they dropped the bid or offer for each of the next three sells. Not unusual, but then with three buys, they dropped and then another three buys, they drop again. From 2:38 to 3:16, the blocks got bigger, but most were buys, and the spread drifted slightly lower (20k offer vs 4k bid). From there on, 52.4k offer vs 67.2k bid.
I think we're witnessing some convertible preferreds being sold. They can pick a share up at $3.82 this month, but I'm really surprised with everything coming together, they would sell. On the other hand, it's like 'Duelling Banjos'. JNC Opportunity, the $2M preferred convertible investor (who also owns 400k shares of FTEL common), can make their conversion on the 25th of this month, so they may want to put in an 'all-or-nothing' sell block to shake down the price. On the 25th, they can buy at 85% of the average price over the previous four weeks. The other preferred convertible investors ($5M) have to wait til the 1st to convert. They see that JNC is opting to hold the price down and they realize if they convert now, at least they can piggyback the ride up, as the price begins to head up in a few days or a week. Our question is: How do we know this foolishness is over? Watch for a pop in the price something of the order of 'the offer becomes the bid' or better. In that case, JNC will have retracted their 'all-or-nothing' bid to sell. We've seen this before.
This is all theory. Seems to me like the only alternative theory to a stock going down while being accumulated is that the MMs found religion and have decided it's okay to sell something for less the more people want it. <ggg>
WH |
