Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Biotech / Medical : LJL Biosystems, Inc (LJLB) -- Ignore unavailable to you. Want to Upgrade?

To: ahhaha who wrote (58)	4/6/2000 2:07:00 AM
From: Howtrade	Read Replies (2) \| Respond to of 90

aucontraire, mon ami.... I'm afraid, in this instance, you're the one who has something to learn. I'm surprised at your naivete. You talk as if market makers are simply clerks, processing orders in the order in which they receive them. That is part of their job, of course; i.e., to provide an orderly market. Another, equally large part of their job is to MAKE MONEY for themselves and their trading institution. They buy and sell for themselves, too! And, if they've finished filling orders for the day (all orders on the "book" have been completed), as it appears happened today at about 3:45pm, and small daytraders are looking to close out their day positions, here's what will happen: market makers will often just fulfill their legal obligation, which is 100 shares. When market makers stick to the strict letter of the law that way, near the close, the price can go down a full point or more on extremely light volume. And that is what happened at the close today. You are way off base when you indicate some sort of "angry" reaction on my part. Far from it. I played this end of day game with my market maker friends: took profits, and then bought on the drop, right at the close. Check it out a little further. You actually may learn something.

To: ahhaha who wrote (58)	4/6/2000 3:00:00 AM
From: Howtrade	Read Replies (1) \| Respond to of 90

MM & Price Action 101 Keep in mind: 1. The fewer the Market Makers making a market in a stock (LJLB has a relatively small # of MMs) and the more thinly traded the stock, the more the MMs can quite legally manipulate it. And they do so, while still providing a relatively free, balanced and fair market. The operative word is "relatively." Of course, MMs no longer practice collusion and price fixing. Heaven forfend such onerous acts. But just 3 years ago, the SEC found collusion and price fixing to be rampant among NASDAQ Market Makers. Those MMs (many of the biggest and most "reputable" institutions in the business) were roundly prosecuted. They were slapped on the proverbial wrist by the SEC, given fairly hefty fines, and had to promise "...never to do it again." 2. Markets are Made. That means men and women organize and run them. 100% objectivity does not exist in them. If the markets were 100% objective, there would be no Market Makers on the NASDAQ, or Specialists on the NYSE, just computer terminals, and technicians to make sure the hardware worked efficiently. We are in fact moving toward greater objectivity in the markets. But we're not there yet, not by a long shot. 3. Case Study in Price Action, Market Maker manipulation, Volume, and Order Flow: CYBX is a classic case. Its price action on Mon, Tues, and Wed, 4/3 - 4/5, should be required study-fare for anyone truly interested in what really happens in the market place.