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Technology Stocks : VALENCE TECHNOLOGY (VLNC) -- Ignore unavailable to you. Want to Upgrade?

To: Rich Wolf who wrote (21288)	8/25/2000 7:35:47 PM
From: Robert Cohen	Read Replies (1) \| Respond to of 27311

Thanks to bigcue: atk.com

To: Rich Wolf who wrote (21288)	8/26/2000 11:13:14 AM
From: John Curtis	Respond to of 27311

Rich: Your thinking about VLNC, its position vis-a-vie short verses long, and where to from here, pretty much mirrors my own. Rather, I expect them to step aside whenever there is a rally, then look to cap the stock when the buying interest wanes, even suckering in more buying (premature) at higher levels, before shorting it down 50% of the run or more.......That is why I expect any required 'covering' or new shorting to occur by means of a 'mark up' and then take-down, rather than a driving down as we saw in the past, esp. in April.... Agreed. This, I believe, is exactly what has been going on, particularly with the last pop. Stand aside and let it run until exhausted. Wait for any news against which the pop can be attributed, and if none comes, take it gradually back down(uuuuhhhh...and this isn't to over-look the likely day traders riding the pop and then leaving with profits in hand). Like you, I've seen this tactic used quite often with other equities here in the past few months, and I expect it to continue with VLNC while they(management and employees) continue to lay the ground-work for future p.o.'s, etc.. So it goes. As a guess I'd say the frequency of the aforementioned tactics' use, generally speaking, here in recent months probably stems from the mania fever being at least partially "broken" this past March/April. Once a fever like that breaks the tactic you refer to becomes very easy to implement and maintain. In other words, the investment climate turned a wee bit bearish. Market-wide the remainder of the year should be very interesting... Anyway, just some thoughts. Now out to enjoy the gorgeous day here in the Northeast. John~

To: Rich Wolf who wrote (21288)	8/27/2000 4:40:22 PM
From: The Vet	Respond to of 27311

Rich I agree than some of the short position is "boxed" but that does not necessarily prevent a short squeeze. "Boxed" shorts are only gaining interest while the price remains below their selling price. As soon as the price exceeds that then they are subject to margin interest and margin calls until they either deliver the shares or cover. The lawsuit shares may or may not be available immediately to those who have already shorted them. That could put them in the invidious position of having to either cover or pay margin calls on stock they may own and have shorted but is not yet issued to them. (I know a little about this as I was once caught is a squeeze with options where I sold short a little time prior to converting them to shares.) Either way "boxed shorts" may not be quite the same as naked shorts but they effectively reduce the float available as they certainly can't be sold again when the price improves.