Hi Samuel; I mostly try to joke around it some..but sure enough
when you see this amount of volume ( well above normal ) & roll
for several days what you are seeing is the roll of a lot of
short positions.. ( borrowed stock covering to others shorting )
there are not enough real sellers or buyers to cause this
type volume.
There are people who do become like Capt Ahab chaseing Moby Dick,
the great white whale for them is high stock prices, they get
burned over and over & many of them go broke.
They get obsessed, and often don't look at the mechanics of
it all..blithly unaware how their friendly broker takes up a
short position, and closes ahead of them, or before big buy
orders ( of real stock ) can hit. This is something brokers
don't talk about much, and if CNBC were to do some real reporting
instead of the hype they do , why they might lose
half their add money.
So you have obsessed shorters chaseing bad news, with brokers
loving it, and also going short in front of them then this wild
orgy of trading ( that for some reason most people think is
the stock trading ) when in fact it's mostly borrowed shares
swaping positions..after the smoke clears and the brokers are
all covered the stock goes up and the last batch of shorters
get gut and gilled.
Why do they do it, they are hooked just like a junky. The high
price of stocks is the great white whale, it has wounded them
in the past, most all of them are trying to play catch up.
Most of the money they lose goes right back into the market,
and the great white whale gets even bigger it.
The vast majority of them will quit someday, and go quitly out
of the market only to be replaced with a new crop.
Jim
I better add a lot of them count on stop losses to limit their
loss..but I can't count the times I've heard them complain
about they had a stop at say 26..and found the broker covered
it at 28 and not 26..as when the market moves fast a stop will
get you out..but not always at the price you set.
--------------------
Last but also worth mention is the hope of getting rich
on a real big sell off can seldom ever happen if your short.
IF the real big owners of the stock want to sell in a big
sell off they can and do cause the borrowed shares to get
recalled, before they sell, they are not compleat fools.
---------------------------
Jim
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