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Biotech / Medical : IMNR - Immune Response
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To: jake burns who wrote (1061)9/23/1998 2:22:00 PM
From: ahhaha  Read Replies (1) of 1510
 
Short squeezes are very rare. In the modern era those who make a market prevent the evolution of short squeeze by gapping. You won't see trade by trade relentless upside action that is the hallmark of the squeeze. In all the active stocks you have options which neutralize the panic potential that is necessary for the squeeze to work well. That is why you see heavy short interest. The short positions are fully hedged and don't need to be unwound immediately. Many institutions have trading and investment accounts in which they are short and long the same security respectively. Covering helps the long side look good. In the modern era short interest doesn't mean the market must rise. Short interest rises with the market and falls with it too. It is a meaningless measure now. This is not to say that short covering doesn't make price rise. In fact, these daily market wide gaps we are seeing are the result of trading short covering. Most immediate run-up action is due to shorts. Trading creates the jiggles whose average asymptotically approaches the rational expectation of the stock's instantaneous worth.

Since IMNR's worth is difficult to assess, the amplitude of the jiggles is indeterminate. When you have few sellers, the stock will pace the market. Volume usually means new buyers based upon previously unknown information. If you don't get that, you know most of the action was short covering, and so the worth can't be much higher than where it was previous to the run-up. An examination of most stocks shows that there is a paucity in volume on the advance since Sept. 1. The speculative shorts are pretty much out of position, so further action needs volume. As long as the FED pumps you don't need substantial volume, but you have to look at most stocks as in the process of forming right shoulders in their 3 year bull market phase. IMNR is not really part of the "market". Without news it will hit the skids once the big boys have finished with their right shoulder operations.
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