First of all, as mentioned in an earlier post, I seriously doubt that this stock was shorted! For an individual to short a stock, you need to have an uptick. Now let's look at Thursday's trading log:
V 1999-03-04 13:16:36 2.150 .000 1000 9 Green Line 82 DS
V 1999-03-04 11:23:48 2.150 .000 1000 9 Green Line 31 Global
V 1999-03-04 11:23:24 2.150 .000 300 9 Green Line 31 Global
As you can see, 2,300 shares were traded at 2.15. Now let's look at Friday's opening:
V 1999-03-05 07:00:48 2.010 -.140 1000 31 Global 82 DS
V 1999-03-05 07:00:48 2.050 -.100 500 82 DS 82 DS
V 1999-03-05 06:42:30 2.070 -.080 2000 35 Canaccord 82 DS
V 1999-03-05 06:30:18 2.100 -.050 1000 9 Green Line 82 DS
V 1999-03-05 06:30:06 2.100 -.050 1000 31 Global 82 DS
V 1999-03-05 06:30:06 2.100 -.050 1300 12 Nesbitt 82 DS
Hmmmmmmmmmmm! No uptick. Therefore, either a brokerage firm was illegally shorting the stock, or someone decided to dump some shares (albeit a large number of shares) onto the market.
In addition thereto, with respect to the following excerpt:
When stocks get overextended on psychological euphoria, smart investors, who realize the price discrepancy, short the stock, slowing the upside move. And when reality sets in and stock owners hit the panic button, all running for the exit door at once, the short sellers are the only ones around to buy the stock back and make the downside move smoother and less severe.
Someone who decides to short a stock generally (I use the word generally because TA does not work well on event driven small cap stocks) looks for an overbought position using various TA indicators. Now, in the case at hand, I do not see a technical motive to short the stock. Moreover, as everyone has noticed, there has been no upward movement to slow down! The only movement we have seen has been a downward slide.
Finally, I strongly doubt that the shorter instructed its agent (DS) to fill everything up to and including 1.90 WITHOUT breaking that barrier (I wouldn't call it resistance). Weird, don't you think?
The latter is the reason why I doubt that someone was short selling this stock. In effect, if they knew there was bad news around the corner, don't you think they would of shorted the hell out of the stock?
Having said that, I wonder why Mr Jacobs told one of the posters that he thought that the stock was being shorted?
Kind Regards
AK |
