There are a lot of references to how MMs manipulate the stock, and when I find them, I will post the links, but for now I think perhaps a brief explanation of the process would help.
Normally in a "real" trading situation, buys cause the stock to go up, due to supply and demand, and sells cause it to go down for the same reason. However, when we are talking about a BB stock there is one more variable in the equation. That is the Market Maker. Once we introduce the MM, greed steps in. The MM fills a buy order for , say 100K shares at .10. THEN he has three days to actually get the stock, which he does at a lower price. So at .08, he buys 200K, and then lets the ask go back up to .10 to sell those shares, plus some more and it continues like a yo-yo endlessly. It never breaks out until the buys are coming in at a much greater rate than the sells so that he must raise the price to be able to make the profit. Sometimes, it starts going up and he thinks he can bring it right back down so he waits to get the stock for that three day period. But, other MMs raise it anyway, and that MM has to buy at a higher price to meet his committment. That is how John got IT in the first place, when a MM had shorted all the way up to 12 totally expecting to be able to cover.
Now, you might ask yourself why would a MM want to bring the stock down to .02 when he could have done this at .10. Volume is the answer. at .10, he is able to churn 1M shares a day, while at .02, the same dollars would churn 5M. So, you see, that as long as the MMs are in control of where the stock trades, then we are going to have this story.
Other than massive buying, there is only one other way to cause the stock to go up. That is, of course, to hold long. Realistically, anyone who bought at greater than .05 and is selling now probably needs their head to be examined! If there are no sells, then the MMs have to raise the price to get shares or face running out of time without closing the orders in hand.
I have gotten several PMs asking why folks should hold. These are folks holding a lot more shares than my measly 1/4M shares. Well, I give them all the same answer, and that is that it really does not matter what happens in the next couple of weeks, after the shareholder meeting, this puppy is going to be moving, not only because of the information being disseminated at the shareholder meeting, but because money will be coming in, we will know what the projections are, and in short, there is going to be a lot of buying, and not a lot of selling. Of course, in the interests of mumbo-jumbo, I reserve the right to be wrong, but if I am, I invite any and all to stop by so that I can buy you a drink and we can talk about it and drown our sorrows together.
Finally, a friend of mine told me that with the stock market as it is today, he sleeps like a baby : He wakes every two hours and cries. |
