I have been following this thread for a while now and feel compelled today to warn everyone of exactly what Mark was referring to in his post about MM's. First of all, everyone is entitled to their own opinion and I am not about to force mine upon anyone. I just would like to point out some things that I find questionable. I follow about 10 - 15 stocks at a time and watch them tick by tick every single day, and I am firmly convinced of MM manipulation in some form in many of the stocks I follow. I however must say that this is not evident in every stock,but is very obvious in some.
One of these stocks is ADLP, on Mon of this week the stock broke down badly from 3 1/4 down to 2 on very low volume,but the bid just kept dropping. Then on Tues the stock trades heavy volume and goes back to 3 1/2. All of this happens after the stock has traded for over a month in about a 1/2 point trading range. Then last night after the bell the co. releases the best release ever announcing one their first contracts. These MM's were very obvious in dropping the bid, scaring some poor individual investors into selling thinking something was wrong, and then accumulating a large inventory the day before a major release. This is very illegal but unprovable and I hope the SEC puts a stop to it very soon. I have witnessed this exact scenario many times over in many different small stocks.
Another good example is with GIFS. This co. has pissed off many MM's by actively pursuing a move to the AMEX in order to get away from the manipulation that has been occuring in the stock. Yesterday the co. held a conference call and about 30 min before the call a trade comes through at 2 5/16 when the bid ask was 2 1/2 - 2 17/32. This trade was corrected later to be a buy at 2 17/32. If this trade would not have occurred then their would have been 6 trades in a row at the ask and the low for the day would have been only 2 15/32. This particular stock would have broken down technically if it went below 2 3/8 and this MM knew this. So he was able to paint the tape and scare away alot of people from buying thinking the stock had broken down.
These type of things happen all the time and help make these MM alot of money. Hopefully, by way of example I can help some people recognize these activities and not fall victim to these clever little tricks. People please be wary of what any ex MM or current MM's have to say on the internet. These guys like to band together and protect each other. Dennis here on this thread was very quick to defend MM's and respond to what Mark said. You must note however that he hasn't posted on any other threads, has a position in this stock, is friends with a MM in this stock, and hasn't posted on this thread for almost a month, but jumps the gun to ward off accusations of MM manipulation. This to me is very suspect to me. This reminds me of what happened yesterday during the GIFS conference call when MM manipulation was brought into the discussion. The next question after this was a MM working for M.H. Meyerson which is a firm that has been involved in many other stocks that have big manipulation problems including SEXI which was halted and being sued by the SEC. This caller preceded to disrupt the entire conference call with his defense of how a MM only makes a market in a stock and in no way do they engage in collusion. The entire time I was listening to this happen I couldn't help but think how this person is right now confirming everything that I had suspected about manipulation in this particular stock by the way in which he was defending himself. You can learn alot by the people react.
Sorry about the length of this message, but I just thought this would help put things into proper perspective. If I can succeed in helping at least one person then I feel as if I have gained something.
Greg
This message is not directed toward any one person, and in no way am I accusing any of the MM's in this stock of manipulation. The contents here are my opinion only and should be taken as exactly that. |
