The selling this week seems to have been initiated by two brokers, at two different firms, both located in Southern California, who liquidated their Microvision holdings due to margin calls caused by a drop in other stocks.
One of the stocks which caused this situation is reportedly Supergen (SUPG) which fell from an intraday high of 18 over the past few weeks down to around 10. I don't know anything else about this particular stock.
I believe the selling started at one brokerage firm and then spread to the other, where a broker found himself in a similar position. Of course when the price began to drop others joined in the selling either out of panic or to take advantage of the short-term technical situation. So, bottom line, the selling appears to have had nothing to do with Microvision at all. The stock was merely an innocent bystander in the margin calls.
Now one may ask why did they sell Microvision and not the stocks which had fallen? or one may want to know whether the manner in which they sold Microvision was really necessary. Unfortunately, those questions are impossible to answer, and there are a variety of motives one could ascribe to such behavior, some benign some not.
Make the conclusions you will. From my perspective Microvision's fundamental outlook remains the same. We've just got some pleasant news courtesy Discover Magazine, and things seem to be on track and on schedule. Plus, there are exciting developments on the horizon.
Since, I don't know the particulars of these broker's accounts, it's impossible to know whether the selling pressure is over, but I think it is useful to understand the root cause of things in order to know what actions to take.
Stephan |
