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Microcap & Penny Stocks : DCI Telecommunications - DCTC Today -- Ignore unavailable to you. Want to Upgrade?

To: Baldwin who wrote (9352)	10/16/1998 1:18:00 PM
From: Lee Bush	Read Replies (1) \| Respond to of 19331

Baldwin: This is simply a ploy by the MMs to move the price upward, but usually downward by doing a small trade between themselves. It can have the effect of scaring investors into selling or buying, or simply moving the price where they want it to go. Let's say a MM is short a stock and wants to see it continue to slide downward. He can put in a buy order of a hundred shares below the bid with his buddy MM supplying the stock at that price and thus lowering the bid. This reduces his short position, but only to a minor amount. The overall value to him is a gain, since he is short thousands of shares at a higher price. At some point, he will begin to cover. Many investors only look at the bid/ask price, not the volume trading at those prices. By scaring investors into selling, he can cover his short at the lower price with the new shares on the market. It requires collusion, which is illegal, but... Lee