Tim, assuming that indeed there are people shorting, they would use these intermittent rallies (we had one going to $.37 just recently) and cover at through. Let say our shorter shorted at $.5 a month or two ago. He had to put up only $.25, he covered at let say, $.25 two weeks ago, thus doubling his money and causing a nice rally to $.27, he now shorts at $.33 to $.35 and will cover again at let say, $.17, he doubles his money again. A new rally gets it to $.225, were he shorts again and then he covers at $.11 doubling his money once more, and if the company finally has to throw in the towel (which is probably what the shorters think is in the cards), he may not even cover any more but continue and short the stock into the ground.
Of course, those shorters must have a pretty good pipe to the developments at GPGI to time their activities so perfectly, but on the other hand, with such relatively thin activity, the shorters themselves might have enough muscle to start rallies (by covering) and start declines (by heavy persistent selling).
Zeev |
