Doug Couglan,
Nothing personal, wasnt that the name of the guy in Tom Cruises's movie, "Cocktails", who wanted to marry a rich chick, did, and blew all his money on soybeans and other commodities, only to kill himself at the very same time Tom Cruise was making it with his absolutely gorgeous wife Kelly Lynch? (I only know this because I made the big mistake of letting Nancy go to the video store alone when we are on vacation and she actually rented that thing).
Two things, yes, a large short position,if the stock turns can provide tremendous fuel to the fire. Shorts cover, more buying pressure and stock goes higher, more nervous buying, the higher it spirals. But sometimes a lot of shorts can be a bearish sign as well, you short a stock at 40 and it goes to 12, if you still believe, keep piling on it, depress it, kill the longs, disappoint them, pressure the stock, if you lose a few bucks on the last few hundred shares, big deal, you have 20 in the pocket already, but at 12, the company probably cant sell shares to public, no employees will want to join, employees get disappointed about stock options and leave, you can squeeze (OPPOSITE OF SHORT SQUEEZE) the life right out of a depressed heavily shorted stock. Fundamental changes and earnings can turn it around and turn it into a classic short squeeze as well.
Your long argument, well, 100% of stock is long, so thats the norm, but yes, if I had 200K of AMZN and xyz fund has 400K and my buddy had 100K, all at, lets say 10, 20 bucks, (from about a year ago), I know that I could with buying 10, 20k a day from all of us, push the button on this stock and keep it floating higher, pressuring shorts to get off the coach and cover, etc. sure if I add another 200k at 110 or 120 and lose 10, 20 on that, no prob., I have 90pts from the other position. Yet again, change in fundamentals will drop that plane from the sky.
Longs or shorts will often push a position to its limit, understanding they wont get the top or bottom, and then when it turns eliminate the whole position, wherever, however it takes...classic momentum playing.
Regards,
Steve@yamner.com |
