I was just fooling around with some numbers that I thought might interest some. I do not claim professional status here, my interpretation can be wrong.
Since November 2, 1998 a total of 359,212,000 shares of AXC have changed hands.
Of that, 207,165,000 (57.67%) changed hands on days when the stock was higher than the previous day, and 117,057,000 (32.59%) changed hands on days when the stock was lower than the previous day. Ratio of: 1.77 : 1
From November 2, 1998 (when the stock price was 1) to January 28 (when the stock price was 5) 215,487,000 shares changed hands (60% of the total volume for the period between November 2, 1998 and March 2, 1999). Of that 133,331,000 (61.87%) changed hands on days when the stock was higher than the previous day, and 49,478,000 (22.96%) changed hands on days when the stock was lower than the previous day. Ratio of: 2.70 : 1
From January 28, 1999 (when the stock price was 5) to March 2, 1999 (when the stock price was 3) 143,725,000 shares changed hands (you guessed it, 40% of the total volume for the period between November 2, 1998 and March 2, 1999). Of that 73,834,000 (51.37%) changed hands on days when the stock was higher than the previous day, and 67,579,000 (47.02%) changed hands on days when the stock was lower than the previous day. Ratio of: 1.09 : 1
The way I see it, this means that as a consequence of the owners of 19% (47.02% of 40%) of the shares that have changed hands since 11/2/98 selling their shares into the descending market between January 28 and March 3, the stock price for the owners of 58% of the shares that have changed hands since 11/2/98 (those who bought in a rising market) was reduced from 5 to 3 or 40%.
That the owners of 20% of the shares that have changed hands since 11/2/98 have sold their shares into a descending market does not seem unreasonable to me. It seems unreasonable to me that the effect of this could have caused such a deterioration in the stock price in a market that was otherwise stable or heading up: in other words, the degree of damage has been exaggerated as a consequence of the greater market.
The attention of the bulls should be on the fact that the owners of 60% of the shares that have changed hands during this period have held on to their shares. A fair vote of confidence.
Since the word out there seems to be that Friday's unemployment figures are the thing that is causing concern to the market, it seems likely that there will be no great general improvement in AXC until after those figures are released. (Although, as of the close, there was a certain amount of upward movement in the Tech sector which could mean an up move in the morning). Since it is also likely that the unemployment figures will be strong, and since a strong unemployment figure will be taken negatively by the market, even to the degree that some are predicting a very bad reaction, it seems possible that this “water torture” will continue on into next week. When the market does turn up, however, it seems reasonable to think that the up move will be more or less explosive in that the balance of power will switch disproportionately to the bulls: 4:1. |
