#CANNABIS_NATION: Digger finds the life of an MM...:-}


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JoelDecember 21, 2016Blog Posts

I was an OTC MM for about 10 years ending in the late 80’s. Since then I have been strictly an investor. Since I have not been that up to date in MM rules I will only make statements that I feel fairly confident are still accurate regarding these activities. By and large most MM don’t have a clue nor do they care to learn, about the fundamentals of the stocks they trade.
They just try to make orderly markets. When dealing with BB stocks it is very easy for a MM to get trapped into being short in dealing in a fast moving market. Reason being; most of the MM’s in this stock are what are called “wholesalers” this means they don’t have retail brokers “working” the stocks.
So they have to rely on what’s known as the “call” from larger retail houses. If a “Big” retail firm like an E-trade calls up a market maker to purchase say 5,000 shares of a stock, they expect to get an “execution” from that market maker. If he turns them down, or only gives a partial then the “Big” firm will go to another MM.
If this second MM “fills the order” then that “Big” firm has a moral obligation to continue to give future “business” in that stock to that MM who performed (his life blood). This will go on until he “fails” to perform and so on.
Contrary to popular opinion the “Big” firms Do NOT neccessarily go to the “Low Offer” to fill a buy order (Or high bid for a sell). They “Go” to who they think will perform to fill the order and expect that MM to “match” the “low offer” in the case of a buy (bid in the case of a sell). Even though this MM might in fact be the “high bid” and not really want to sell any more.
As a wholesaler he must perform or he will get a reputation as a “non-performer” with the “Big” houses and will cease getting “calls” which means he will soon go out of business. I mentioned above that this activity is very significant to BB stocks. I say this because most of the trades in these BB stocks are “unsolicited” and are done through discount houses.
With the above groundwork laid, let me try to explain how market makers get short even if they like the Company; Lets say that a stock (shell) has been lying quietly at $.25 bid $.50 offered. A limit order comes into one of the MM’s to Buy at $.50 for a thousand shares. Prior to this trade that MM may be “flat” (neither long or short any shares). He fills the order and is now short 1,000 shares. He may raise his bid hoping to find a seller to “flatten” out his position. But before he realizes it a wave of buyers have come in and cleared out all the $.50 offers. Now the stock is $.50 bid .75 offered. Here comes that “Big” firm he just sold the 1,000 shares to at .50 with another bid for 1000 at .75. He makes this print. Now he is short 2,000 at an average of .625. The market keeps moving and now its .75 bid 1.00 offered. Now he has to make a decision.
Just like investors, MM Hate to take a loss. So 9 times out of 10 he will now sell 2000 at 1.00 making him short 4000 but with an average .81. At this time he would love to see a seller at .75 so he can cover his short and make a few bucks.
But instead the market keeps moving up. Now it is 1.00 to 1.25 and here comes the buyer again at 1.25. He doesn’t want to lose the call so now he needs to sell 4,000 at 1.25 to keep his break even point above the bid. Now he is short 8,000. Market moves up to 1.25 bid 1.50 offer here comes the buyer now he feels he must sell 8000 here because “stocks don’t go up forever”.
Now he is short 16,000. And so on and so on. If the stock keeps moving up, before he realizes it he could be short 50k or 100k shares (depending how big his bank is). _________________________
Finally the market closes for the day and on paper he may look all right in that his “break even” price may be around the closing price. But now he has to figure out how to entice sellers so he can cover this short. It is important to note that if this happened to one MM it has probably happened to most all of them.
Some ways MM’s entice sellers; Run the stock up with a “tight spread” in a fast market, then “open” up the spread to slow down the buying interest. After it has “cooled off” for a little while lower the offer below the last trade right after a small piece trades on the offer then tighten the spread so that the sellers feel they can take a “quick profit” by “hitting the bid” on the tight spread.
Once the selling starts the MM’s will walk it down quickly by only making small prints on the way down with the tight spread. Another way is by running the stock up in the morning, averaging up their short then use the above technique to walk it down in the afternoon.
Hopefully after doing this for several days, it will demoralize the buyers. The volume will dry up and the sellers will materialize thinking that the game is over.
Contrary to popular opinion, MM usually Do Not Cover in Fast moving markets either Up or Down if they are short. They Short More. They usually try to cover after the frenzy is out of the market. There are many other techniques they use but the above are the most popular.
This technique works about 9 times out of 10 particularly in a BB market. However that is because 9 out of 10 BB stocks are BS. Remember what I said above. Most MM’s don’t have a clue as to the value of a Company until they get trapped. If the Company has solid fundementals and a bright future. Then the stock will do very well. And the activity that caused the situation will prove to even help the future stock activity because it created an audience.”
Market Maker’s Operating Procedure
The savvy long-term investors never chase stocks up. For the most part that is momentum players and daytraders where most of it or what follows is dumb money. Instead the long-term investors use a couple of simple strategies in order to position themselves. One is to find a stock no one immediately sees has huge potential and accumulate. Long-term investors are not interested in trading against the public mind or the dumb money. That’s where the majority of the money can be made but even more can be made if the base of a stock is held extremely strong by investors. However the second is not to doubt the research which is the underlying basis for going long and holding.
More and more investors are winning the game nowadays despite all bashers that float through the Internet that has become part of the game. Floor traders of market makers often watch CNBC, news wires and bulletin boards in order to follow the market during trading session. OTC BB market makers (MMs) don’t use fundamental and technical analysis. However, what they do realize is a lot of dumb money does use this newest nitch charting or TA (Technical Analysis) to run a stock either up or down. To the MMs this is like taking candy from a baby. Simply they will paint the tape and use whatever tactic to affect the charting bands. Thus the public and dumb money they will have eating out of their hands. Effectively the MMs can show a strong stock growing weak by manipulating the close price in order to generate selling volume, delaying trading time to manipulate trading activities, or even stalling the ask without honoring orders to hold a stock price.
MMs follow a simple code of business when making a market in a stock especially an OTC BB. That is the level that stocks will seek that yields the most volume. Now this is very important because they make money on the volume buying at the bid and selling at the ask. In other words, by making the market they are buying low and selling high. Now smart money adheres to that rule, so do all the market makers. They could careless whether the stock is at $83 or at $0.23. All they care about is the action thus being able to sell stock at the offer (The high) and buy stock at the bid (The low). To increase their profitability, they make the spread as great as possible on as many shares as they can especially if the volume falls off.
When they have mostly all “buy” orders, that’s not the price that’s going to yield the most volume. They need both buy and sells to get the maximum action. Remember, MMs play the volume. If the volume decreases and there are mostly Buys that become a one way volume, Buy volume. So what they do is let the stock run up to a price where it runs out of steam. They fill all the buy orders there that they can and then comes the pullback one way or another naturally or induced. During the pull back they can buy tons of shares and flip them to those averaging down or trying to catch the bounce. At some price, the stock will be relatively stable and yield the most volume. Now that is the average price you will see
The average price is the point where a stock seeks a level where MMs can profit on the most volume. So during the day that is the price that MMs and momentum/day traders want to see the stock at. Why? Because they know the public and dumb money was chasing the price thing up. Most of the time, the MMs love a flurry of Market Orders which is a dead sign of an artificial run or momentum. Merely it is money in the bank for them. Most get hung in a momentum or day trade or by the tactics of Market makers, who are in the business to screw the public every chance they get and the NASD is not going to do anything about it. They are merely making the market liquid is there reasoning.
The market makers have created an added complication to the OTCBB’s chaos of the already volatile intra-day price movements created by dumb money, momentum and day-traders. MMs can not relate to long-term holders in the OTC BB. That makes absolutely no sense what so ever. They feel a large percentage of trades in the OTC BB market consist of short-term or day-trades, MMs merely view the barrage of buy and sell orders as relatively neutral to the market. How they figure it is when the average dumb money buys shares in a company, the MMs feel or rather know with some certainty it is very likely that dumb money will want to sell back those shares relatively quick on the slightest drop.
Now somewhat comfortable with this logic the MMs merely short sells into the buying and attempts to take the stock down in an effort to “shake out” the weak. Since it is tough to know for sure whether a move is the beginning of a trend, or a routine shake out, this type of deception works quite well for the MMs. What the long-termers do to a stock is surprise the MMs because instead of falling the shorting has no effect and the price goes up. Now that puts the MM at selling low through shorting and thus having to buy high in order to cover.
Boy, when this happens, the MMs are not very happy campers. The investors and traders are supposed to be doing that no them. Now it becomes time to pull out every trick and tactic in the book in order to attempt to get a Bear Raid at every dollar mark or percent from where the stock started. Could be a penny in smaller priced securities? What MMs do is give you a chance to make a small amount of money for your momentum and day trading style by shorting it at these levels and trying to get a bear raid each time. Each failure is compounding the MMs short position so they let it go to the next level. Now come more deliberate tactics MMs use to coerce Bear Raid or panic selling.
Once the MM is caught short and the strength of the buy is overpowering the MM will want to cover his short position. So the MMs call up one of his friendly MMs and says some like “the weather is sure rough today.” The MM along with the other “friendly MM initiates a down tick about the same time. Now this can also be done with a certain amount of shares such as an infamous 100 shares flag. This down tick gives the illusion of weakness designed to hopefully begin the bear raid of selling. The fickle, fearful, day trader, momentum and short term begin to sell out allowing the MM to cover his short position at lower prices. They will move it down quickly to get it to a price of least financial damage. Problem they have is long-term investors in the OTC BB. They start accumulating and buying comes flying in when they take it too far thus the MMs took it to the point of volume again and not only investors the other MMs step in the make money on the spread.
Alas the poor MM does not get to cover. Now comes various tactics like stalling, boxing, or even locking the Bid and Ask for a while.
Of course, MMs aggressively deny any sort of collusion designed to fix quotes or spreads, but a recent SEC investigation tells another story.
MMs have a vast resource of tactics and it would take probably more than my lifetime to figure them all out.
So how do investors somehow manage to overcome the obvious deception in OTCBB arena? One answer is indirection trading style by going long which the MMs do not expect. In the war between investors and public companies on the OTC BB vs the MMs, if the MMs have all the advantages due to position or other factors, direct confrontation such as momentum or day trading hitting the stock is a definite death sentence.
However, an indirect approach tends to weaken the path of least resistance before slowly overcoming it. The most effective way is long-term investors slowly accumulating and holding thus drawing the MMs out of its defenses making them as naked as their short position. This is war so this slow accumulation and holding for the long term easily achieves the desired effect to force MMs to cover and knock off the tactics or bury themselves deeper.
The MMs when caught will especially use every trick and tactic in the book to get a Bear Raid thus playing on the individual fear of most people. The MMs feel they have information and position advantages over the investors as long as the holding of the stock is in weak hands or short term holders. Since they are OTC BB MMs who believe all OTCBB companies are not worth investing and management is ineffective regardless what is happening within the company.Furthermore, MMs know they are in the position to impose a great deal of influence in OTC BB stocks trading when it suits their needs.
This inherent power of position enables the MMs to move the markets at any time up or down. As a result, the only way to draw them out of their favorable position is going long. Now this does not mean just any company but to effectively nail the MMs, Longs must find the great company on the floor and accumulate long before the MM tactics and games begin.
Market Maker Speaks Out:”Ways of a Market Maker”
Author: Unknown

oops-please delete

agreed! :)

I love the pic, best ship in the series!!

I know this is a ghost town now...but i found this through a little google search...should sticky this thing.


Market Maker Speaks Out:Ways of a Market Maker

(REPOST)

I was an OTC MM for about 10 years ending in the late 80's. Since then I have been strictly an investor. Since I
have not been that up to date in MM rules I will only make statements that I feel fairly confident are still accurate
regarding these activities. By and large most MM don't have a clue nor do they care to learn, about the fundamentals
of the stocks they trade.

They just try to make orderly markets. When dealing with BB stocks it is very easy for a MM to get trapped into
being short in dealing in a fast moving market. Reason being; most of the MM's in this stock are what are called
"wholesalers" this means they don't have retail brokers "working" the stocks.

So they have to rely on what's known as the "call" from larger retail houses. If a "Big" retail firm like an E-trade calls
up a market maker to purchase say 5,000 shares of a stock, they expect to get an "execution" from that market
maker. If he turns them down, or only gives a partial then the "Big" firm will go to another MM.

If this second MM "fills the order" then that "Big" firm has a moral obligation to continue to give future "business" in
that stock to that MM who performed (his life blood). This will go on until he "fails" to perform and so on.

Contrary to popular opinion the "Big" firms Do NOT necessarily go to the "Low Offer" to fill a buy order (Or high bid
for a sell). They "Go" to who they think will perform to fill the order and expect that MM to "match" the "low offer" in
the case of a buy (bid in the case of a sell). Even though this MM might in fact be the "high bid" and not really want
to sell any more.

As a wholesaler he must perform or he will get a reputation as a "non-performer" with the "Big" houses and will cease
getting "calls" which means he will soon go out of business. I mentioned above that this activity is very significant to
BB stocks. I say this because most of the trades in these BB stocks are "unsolicited" and are done through discount
houses.

With the above groundwork laid, let me try to explain how market makers get short even if they like the Company;
Lets say that a stock (shell) has been lying quietly at $.25 bid $.50 offered. A limit order comes into one of the MM's
to Buy at $.50 for a thousand shares. Prior to this trade that MM may be "flat" (neither long or short any shares). He
fills the order and is now short 1,000 shares. He may raise his bid hoping to find a seller to "flatten" out his position.
But before he realizes it a wave of buyers have come in and cleared out all the $.50 offers. Now the stock is $.50 bid
.75 offered. Here comes that "Big" firm he just sold the 1,000 shares to at .50 with another bid for 1000 at .75. He
makes this print. Now he is short 2,000 at an average of .625. The market keeps moving and now its .75 bid 1.00
offered. Now he has to make a decision.

Just like investors, MM Hate to take a loss. So 9 times out of 10 he will now sell 2000 at 1.00 making him short 4000
but with an average .81. At this time he would love to see a seller at .75 so he can cover his short and make a few
bucks.

But instead the market keeps moving up. Now it is 1.00 to 1.25 and here comes the buyer again at 1.25. He doesn't
want to lose the call so now he needs to sell 4,000 at 1.25 to keep his break even point above the bid. Now he is
short 8,000. Market moves up to 1.25 bid 1.50 offer here comes the buyer now he feels he must sell 8000 here
because "stocks don't go up forever".

Now he is short 16,000. And so on and so on. If the stock keeps moving up, before he realizes it he could be short
50k or 100k shares (depending how big his bank is). _________________________

Finally the market closes for the day and on paper he may look all right in that his "break even" price may be around
the closing price. But now he has to figure out how to entice sellers so he can cover this short. It is important to
note that if this happened to one MM it has probably happened to most all of them.

Some ways MM's entice sellers; Run the stock up with a "tight spread" in a fast market, then "open" up the spread to
slow down the buying interest. After it has "cooled off" for a little while lower the offer below the last trade right
after a small piece trades on the offer then tighten the spread so that the sellers feel they can take a "quick profit"
by "hitting the bid" on the tight spread.

Once the selling starts the MM's will walk it down quickly by only making small prints on the way down with the tight
spread. Another way is by running the stock up in the morning, averaging up their short then use the above
technique to walk it down in the afternoon.

Hopefully after doing this for several days, it will demoralize the buyers. The volume will dry up and the sellers will
materialize thinking that the game is over.

Contrary to popular opinion, MM usually Do Not Cover in Fast moving markets either Up or Down if they are short.
They Short More. They usually try to cover after the frenzy is out of the market. There are many other techniques
they use but the above are the most popular.

This technique works about 9 times out of 10 particularly in a BB market. However that is because 9 out of 10 BB
stocks are BS. Remember what I said above. Most MM's don't have a clue as to the value of a Company until they
get trapped. If the Company has solid fundamentals and a bright future. Then the stock will do very well. And the
activity that caused the situation will prove to even help the future stock activity because it created an audience."


Just food for thought

Money

80% rule hits on the SP at 1129.70
and weakness comes into the markets.Bestrades shorting AMZN on the Pru downgrade and weakness coming into the floor.. CanslimKen spoke about UIC and WITS and the reasons why traders should have been suspicious on CMN..ISSC and OPEN were also discussed..

COMPX key areas
The 1904/1902 area (200 day ema, congestion) and above yesterday's gap at 1897/1895 (session low 1901.77). Intraday need sustained follow through above intraday resistance in the 1910/1912 area to improve the very short term pattern off yesterday high of 1919.QLGC has res near its June high of 30.84
CHINA stocks still holding strong...Jerry said dead in the SP trading pits..VALUE is 1126.20-1129.70 with an 80% rule in effect
Lots of action in the 1126 area.with lots of evening up in the roll.SPMENTOR saying 1128.25 has to be recaptured on the upside and downside 1123.50 if broken will bring in selling..

Hold or Fold??
U.S. Aug. federal deficit narrows to $41 billion.
1434.75 on Nq's key!!!
Sony wins bid for MGM

DIVG in Semi's and NQ's
At 1:15 est Bestrades notice Nq's making highs while Semi's falter.SMH has to hold 31.23..COMPX res is 1915-17.Next resistances at 1926/1928 (congestion area) and 1933 (Mid-July swing high). Intraday supports have been bumped up to 1914 and 1910/1909.

from lancebps:

actually this summer the pink sheet stocks were the only real
winners probably at a ratio of 4 or 6 to 1 to otc stocks...
the dmty,auml,emtk and a few others..

and of course i have a theory..

the mm's know and run the otc from oct thru april and during june thru august destroy a lot of companies and start naked shorting around the end of april and begin to start covering around the second to third week of august and by end of sept even stockpiled shares to have over inventory to move them..

see because of the filing system on the otc they know everything there is to know about the company and how to go about finding the black hole to hit up for the shares to cover in case..

that is why when news hits in the summer the stock goes from .29 to .35 seconds in 7 minutes and than they sell stock and than trap you in that you end up selling back to them even cheaper than the .29 when news hits..

on the pinks they have no filing system to work with and are in the dark on these companies like the investor and tend not to dig themselves as deep in naked shorting..

maybe the new system is otc from oct thru april and buy pinks from june-sept..hmmm might have something there (agreed)...

TRLG, DOMS is the clear ax on this

PWRM, nice stock, NITE seems to be in command, CLYP seems to be the dilutor

pinkies: IIIN is a good example of mms refusing to showing accurate bid/ask numbers in time and sales. hence, you have no idea whether there is selling pressure (sells hitting the bid), or buying pressure (buys hitting the ask). pink sheets are not required by SEC rule to show accuracy here, a true jungle.

this doesn't happen on all pinkies, but you must be aware that it is a possibility...

be careful!

NUEP, looks like MLCO is the ax.

Accounting for the sharp drop are 100M shares issued at .50 issued when the price was $10 per share.

To the Shareholders of Net 1 UEPS Technologies, Inc.:

The board of directors of Net 1 has approved the acquisition by Net 1 of substantially all of the assets and the assumption of all of the liabilities of Net 1 Applied Technology Holdings Limited, a public company incorporated in South Africa and listed on the JSE Securities Exchange South Africa, through a newly incorporated South African company called “New Aplitec”, which will become a subsidiary of Net 1. In addition, the board of directors of Net 1 has approved the acquisition by Net 1 of certain assets of Net 1 Holdings S.a.r.l., a company incorporated in Luxembourg that currently holds the U.S. patent for the Funds Transfer System for which Net 1 currently holds a license.

In connection with the recapitalization of Net 1 and to provide the necessary liquidity to consummate the acquisition of Aplitec, the board of directors of Net 1 has approved the issuance of 105,661,428 newly issued common shares of Net 1 to the Brait Consortium, a group of affiliated investment funds, through its representative, SAPEF III International G.P. Limited, in consideration for a capital contribution of $52.8 million.

I cordially invite you to attend our special meeting of shareholders to vote on proposals to:

(i) authorize an amendment to Net 1’s articles of incorporation to (a) increase the number of authorized shares of common stock from 100,000,000 to 500,000,000, (b) increase the number of authorized shares of preferred stock from 3,000,000 to 300,000,000, (c) modify the par value of the shares of preferred stock that may be issued by Net 1 from $0.10 per share to $0.001 per share, and (d) authorize the terms of the special convertible preferred stock;

(ii) authorize the issuance and terms of 192,967,138 shares of special convertible preferred stock of Net 1 in connection with the Aplitec acquisition;

(iii) authorize the issuance of 105,661,428 shares of common stock of Net 1 to the Brait Consortium in exchange for a capital contribution of $52.8 million; and

(iv) approve the 2004 Stock Incentive Plan.

If any one of these proposals is not approved at the special meeting of Net 1’s shareholders, the transactions will not be completed.

If the transactions are approved, we will be required to issue up to an aggregate of 192,967,138 shares of common stock in connection with the acquisition of Aplitec. Each Aplitec shareholder who elects the reinvestment option will have the right to receive an interest in 0.814286 shares of Net 1 common stock for each ordinary share of Aplitec it holds.
The special shareholders meeting will be held on May 27, 2004 at 9 a.m. at the offices of Schneider Weinberger LLP, 2200 Corporate Boulevard, N.W., Suite 210, Boca Raton, Florida 33431. We cannot complete the transactions unless, among other things, the disinterested holders of a majority of outstanding shares of Net 1 common stock that cast votes at the special meeting of shareholders approve each of the above-referenced proposals.

Your board of directors has determined that the proposed transactions are fair to, advisable and in the best interests of Net 1 and its shareholders. The board recommends that at the special meeting you vote “FOR” the proposed transactions.

Charles Schwab & Co. (SCH) is exiting the market-making business. It is one of several market makers that have been the subject of accusations and/or legal entanglements over naked shorting allegations and issues.

The company had said it is either the number one or number two market-maker in more than half of all of NASDAQ's (NDAQ) listed stocks.

Recently observers were surprised to find a comment letter submitted to the SEC by Mike Alexander, Senior VP of Charles Schwab, that admits outright that brokerages regularly ignore rules and regulations, saying it is not rules that need to be written; it is changes in behavior that is needed.

The comments were directed towards proposed changes in the U.S. settlement system, but could easily apply to other regulations as well.

"Improvements in the U.S. settlement system will only be truly achieved if and when regulations are rationalized to ensure that all market participants are held accountable for compliance. For example, the industry has struggled with the issue of institutional trade affirmation for quite some time now. While the benefits to the clearance and settlement system are self-evident, Buy-Side firms and Custodian banks have been resistant to make those changes that provide for same-day trade confirmation / affirmation and assurance of trade settlement," said Alexander.

"Schwab opposes the notion that securities intermediaries such as broker-dealers be required to police compliance," he stated. "The NYSE and other SROs have had trade affirmation rules on their books for some time. However, such rules have not been effective in changing the behavior

of Buy-Side firms or their custodians; nor do the rules provide assurance that the affirmed trade will settle.

"Recognition of this fact is evidence that changes to the settlement cycle not only require overhauling systems, but also changing behavior. We believe that only by holding all market

participants directly accountable for making required affirmations will the necessary changes to behavior," he stated at http://www.sec.gov/rules/concept/s71304/charlesschwab061604.pdf .

In a June 23 release, the SEC stated it has put into place Rule 202(T), which establishes procedures to allow the Commission to temporarily suspend the operation of the current "tick" test in Rule 10a-1, and any short sale price test of any exchange or national securities association, for specified securities.

Through a separate order, the Commission will suspend, on a pilot basis for a period of one-year, the tick test provision of paragraph (a) of Rule 10a-1, and any short sale price test of any exchange or national securities association, for approximately one-third of stocks in the Russell 3000 index.

The order also will suspend, on a pilot basis for a period of one year, the tick test provision of paragraph (a) of Rule 10a-1 for short sales executed in any security included in the Russell 1000 index after 4:15 p.m. Eastern, and all other securities after the close of the consolidated tape, and until the open of the consolidated tape the next day.

The pilot will commence on January 3, 2005 to permit broker-dealers and self-regulatory organizations to make the necessary programming adjustments.

The Commission deferred consideration of the proposal to replace the current "tick" test of Rule 10a-1 with a new uniform bid test. The Commission could reconsider any further action on these proposals after the completion of the pilot.

Rule 203, which will incorporate current Rule 10a-2 and will create a uniform Commission rule requiring broker-dealers, prior to effecting short sales in all equity securities, to "locate" securities available for borrowing.

There will be limited exceptions from the locate requirement, including for short sales by registered market makers in connection with bona-fide market making.

Rule 203 also imposes additional requirements on designated "threshold securities." Rule 203 defines a threshold security to mean an equity security for which there is an aggregate fail to deliver position for five consecutive settlement days at a registered clearing agency of 10,000 shares or more and that is equal to at least 0.5% of the issue's total shares outstanding.

Where a clearing agency participant has a fail to deliver position in threshold securities that persists for ten consecutive days after settlement, the participant must take action to close out the position. Until the position is closed out, the participant, and any broker-dealer for which it clears transactions, may not effect further short sales in the particular threshold security without borrowing or entering into a bona fide arrangement to borrow the security.

Rule 203 will become effective 30 days after publication with a compliance date of January 3, 2005, to permit firms to make programming and procedural adjustments.

Rule 200, which among other things, will redesignate current Rule 3b-3 with some modifications to define ownership and aggregation of securities positions, and include a requirement to mark all sell orders in all equity securities. Rule 200 will become effective 30 days after publication.

The Commission also adopted amendments to Rule 105 of Regulation M to remove the current shelf offering exception, and issued interpretive guidance addressing sham transactions designed to evade the rule.

The amendment applies to short sales effected within five days prior to the pricing of a shelf offering. Such short sales may not be covered with offering securities purchased from an underwriter or other broker-dealer participating in the offering.

The Rule 105 amendments will be effective 30 days after publication in the Federal Register, and the interpretive guidance will be effective upon such publication.

Opponents of naked short selling were, however, quick to denounce the provision that allows market makers an exemption, and many market observers said that the SEC should provide a public list of companies that fall into the "threshold security" category.

"The SEC claims that the number of companies involved in this 'threshold security' category is 4% of all publicly traded companies. If in fact it is that small the process is certainly manageable," said the website InvestigatetheSEC.com at http://www.investigatethesec.com . "It is also the right of every issuer, in protecting their business and their investors to know the status of their stock trading."

Some were discussing whether the SEC can keep such information private under the Freedom of Information Act.

http://www.investors.com/breakingnews.asp?journalid=22147218&brk=1

Ever Wonder About the Sheer Depth and Breadth of "Pump and Dump" or "Naked Short Selling" schemes?

Visit http://securities.stanford.edu/filings.html to view the current list of litigations, numbering roughly over 1200.

Such fraud, perpetrated by banks, cannot be executed without the market maker apparatus.

HIET gets a Well's Notice late in the trading day Thursday (7/8/2004 http://biz.yahoo.com/bw/040708/85656_1.html ) and plummets from 1.85x1.90 to .71x.74 very near the close.

around 1.50, or so there seemed to be a hesitation in the stock, as though it wanted to turn right there.

then, absolute carnage.

the stock did begin to turn in the last couple minutes of the session, closing .79x.80.

today (7/9/2004) it gapped to .97x.98, then and ran nicely to about 1.30.

wtf? a Well's Notice (whereby notifications are issued by SEC regulators to inform individuals and companies of completed investigations where "infractions" have been discovered) is just about the worst news a stock could receive. what made the HIET plummet such a terrific trading opportunity?

turns out this little development is a gold mine for mms. you can bet as soon as the mms found out that HIET received the Well's Notice (likely before the news was released), they began to systematically short the stock with as many shares as they could get their grubby hands on (a little trick the average trader can't duplicate on stocks below $5.00).

they gotta cover those shares sometime! combined with savvy traders who know they have to cover, traders know that a lot of buying must come into the stock sooner or later. for HIET it happened right away, as the stock made a ton of money for a lot of traders this morning--especially those with the balls to buy right at the end of the session yesterday (not me!).

just goes to show, good money can be made in any market, even the crappy one we have today.

it doesn't always happen so fast, however. just take a look at the stock formerly known as SEIEQ (now SELA).

Stock-trading cheaters are in the crosshairs - WSJ-- Technical --

The WSJ reports the crackdown on cheating by Wall Street firms took a new turn as Knight Trading Group said it would pay $79 mln to settle a case stemming from allegations that it delayed filling client orders to pocket tens of millions of dollars for itself. The SEC began investigating Knight about 2 years ago, after the departure of former CEO Kenneth Pasternak, when the stock-trading firm's former head of institutional trading filed an arbitration claim asserting that Knight traders systematically traded ahead of clients in stocks in which they had large customer orders pending. The executive alleged that senior traders used knowledge of these orders to buy stocks where they knew there would be strong demand and to sell them when they knew of imminent sales. This effectively gave the best prices to themselves and delayed the transaction of trades for clients until the market had already moved. Clients included Fidelity Investments, the Putnam Investments unit of Marsh & McLennan and T. Rowe Price Group.


from briefing.com

i don't know how many times i've been the victim of this crap. plus, i hear constant complaints about this in various rooms, from those few who are willing to step up and state what is actually happening. not long ago MyTrack refused to guarantee that they could cancel in under five minutes. NITE exploited this silly policy mercilessly, holding trades open, while filling their own orders.

now it'll all be better, because the SEC is "on the case."

hmmm, why don't i think anything but butkus will come from this?

trap BICO

7/7/2004

tough stock, flat out.

the break on BICO is obviously .12 on the chart...a small break, but a break nevertheless. however, all of the action in the stock today occured below the break, on premarket news.

the news was good ( http://biz.yahoo.com/prnews/040707/flw015_1.html ), and it produced a modest gap (opening at .109x.11.) and run, although, it didn't run too far, as the best a trader could have sold was .116. the stock steadily climbed out of the open, as the ASK was hit for thousands of shares, on solid buying, for the first 18 minutes of the session, to achieve a high of .115x.116. on that climb, the ASK was spanked about eighty times, with a variety of lot sizes ranging from a thousand to a hundred thousand shares. eighty times. i counted, hehe.

six minutes later BICO was printing .105x.109.

ouch!

moreover, the BID was hit just sixteen times during the "sell off."

then, lots more shares were bought at the ASK on the "bounce," although this time traders were more savvy, selling more forthrightly between the spread before the fade abruptly topped out, at .108x.11.

again, the mms sprung into a concerted team effort to jar the stock. suddenly, in four minutes, (with the BID being hit just twice) the stock "sold" down to .10x.105.

the bid was hit just twenty times during the entire "sell off." lol. that's a ratio of about five-to-one buying to selling.

finally, the mms were done, with level two showing one slim mm on the bid at .10, and a stack of buzzing mms on the ask at .105.

obviously, the price action of the stock had NOTHING to do with "buying/selling" pressure. come on! no corrolation, whatsoever. please! it's clear to see in the tape and on the chart.

carnage. is there anybody out there who thinks OTC mms are playing with a fair deck? granted, some traders were selling the ask, but i can't imagine that more then 15 of the 100 or so lots were able to do so. BICO on July 7th is a nice example of a bunch of crooks stealing money, flat out.

with this bunch, BICO is one dangerous stock!

be careful out there!

PLKC anatomy of gap trap:

7/7/2004

PLKC had just broken .052 on the 6th. it had some resistance around the six cent mark, but seemed to look decent enough. the stock finished strong on the 6th, after a sharp shake, closing at .055x.056, in break out territory (albeit not expansive territory, given the resistance at six). obviously, this was a possible dip and run off a bottom play.

one play traders like a lot is getting into a stock that gaps up, dips, and then makes a new high. many times the stock will go ballistic off the new daily high. its really a cash register, especially in a strong market.

today, the 7th, PLKC gapped up (although only slightly) to .056x.057. dipped to .052x.054. then made a new high with the ask at 10:20am. five traders got fills at .057, totaling 87,600 shares, as the stock was making a new--a nice entry, huh? hmmmm. then the mms skipped the bid/ask up to .058x.060, opening the spread slightly.

now we're rocking, right?

not so fast. mms filled three more traders, totaling 133,866 shares at the .06. almost right away, however, the ask softened to .059, to "let more traders in" perhaps. quickly though, the stock fell apart, accelerating down sharply to .055 amidst volume selling, then .053 and at last .051, making a new LOD. the ask never got above .054 after that.

pure trap.

but, there were lots of clues. three come to mind:

1) the spread widened to move thru the ask HOD off the dip, straddling it to give the appearence ticker speed.
2) there was definite resistance at .06 on the chart
3) the gap was completely insufficient

and finally:

4) as a last gasp, the ask almost immediately begin to tick down after achieving a new high. big time warning there.

another way of protecting from this trap is to enter on the dip's turn, before the high, if you can do it. then watch very close as it attempts the new high.

i don't think the mms designed this, fwiw, i think the resistance simply brought out too many sellers. had the mms set this up, they would have allowed a lot more shares to be sold around that new high. still, don't put it past them, lol.

be careful out there!

So am I, but I've swithced from stocks to currencies...

well the board is not entirely dead, hehe

still here

Yep, as long as the author goes into hiding right after it comes out, lol!

Well, Cap, obviously it is a scenario that could very well be real. I suspect you'll attract lots of nay-sayers, but it IS something to think on.

As I've said before many times, the true story of everything that has gone on and will go on behind the scenes would make a fascinating book.

today, SPSC perfect example of how crooked mms are: massive selloff, then after two false turns, the stock cruises to 2.935 on heavy buying. Four minutes later the stock almost all of its retrace gains, as the mms, in a concerted effort, absolutely jerked out the rug, on very little proportional selling. when the mms get extremely crooked, as they have been over the past few days, it's time to scalp, scalp, scalp (if you can get decent fills).

this is a phenomena that seems to pervade the OTC mkts; if you see that mms are being especially cruel, you can expect that behavior to permeate most of the stocks in OTC. this is a phenomena that can definitely be felt. adjust accordingly.

again, lots of shares were absorbed at the short term high, but there was no movement in price. dead giveaway. the crooked mms are selling shares at the temporary high, in preparation to bring the stock down.

Nice! Now to figure out how to translate that knowledge into some kind of trading rule or signal... hmmm.

Market Maker Speaks Out:Ways of a Market Maker

(REPOST)

I was an OTC MM for about 10 years ending in the late 80's. Since then I have been strictly an investor. Since I
have not been that up to date in MM rules I will only make statements that I feel fairly confident are still accurate
regarding these activities. By and large most MM don't have a clue nor do they care to learn, about the fundamentals
of the stocks they trade.

They just try to make orderly markets. When dealing with BB stocks it is very easy for a MM to get trapped into
being short in dealing in a fast moving market. Reason being; most of the MM's in this stock are what are called
"wholesalers" this means they don't have retail brokers "working" the stocks.

So they have to rely on what's known as the "call" from larger retail houses. If a "Big" retail firm like an E-trade calls
up a market maker to purchase say 5,000 shares of a stock, they expect to get an "execution" from that market
maker. If he turns them down, or only gives a partial then the "Big" firm will go to another MM.

If this second MM "fills the order" then that "Big" firm has a moral obligation to continue to give future "business" in
that stock to that MM who performed (his life blood). This will go on until he "fails" to perform and so on.

Contrary to popular opinion the "Big" firms Do NOT necessarily go to the "Low Offer" to fill a buy order (Or high bid
for a sell). They "Go" to who they think will perform to fill the order and expect that MM to "match" the "low offer" in
the case of a buy (bid in the case of a sell). Even though this MM might in fact be the "high bid" and not really want
to sell any more.

As a wholesaler he must perform or he will get a reputation as a "non-performer" with the "Big" houses and will cease
getting "calls" which means he will soon go out of business. I mentioned above that this activity is very significant to
BB stocks. I say this because most of the trades in these BB stocks are "unsolicited" and are done through discount
houses.

With the above groundwork laid, let me try to explain how market makers get short even if they like the Company;
Lets say that a stock (shell) has been lying quietly at $.25 bid $.50 offered. A limit order comes into one of the MM's
to Buy at $.50 for a thousand shares. Prior to this trade that MM may be "flat" (neither long or short any shares). He
fills the order and is now short 1,000 shares. He may raise his bid hoping to find a seller to "flatten" out his position.
But before he realizes it a wave of buyers have come in and cleared out all the $.50 offers. Now the stock is $.50 bid
.75 offered. Here comes that "Big" firm he just sold the 1,000 shares to at .50 with another bid for 1000 at .75. He
makes this print. Now he is short 2,000 at an average of .625. The market keeps moving and now its .75 bid 1.00
offered. Now he has to make a decision.

Just like investors, MM Hate to take a loss. So 9 times out of 10 he will now sell 2000 at 1.00 making him short 4000
but with an average .81. At this time he would love to see a seller at .75 so he can cover his short and make a few
bucks.

But instead the market keeps moving up. Now it is 1.00 to 1.25 and here comes the buyer again at 1.25. He doesn't
want to lose the call so now he needs to sell 4,000 at 1.25 to keep his break even point above the bid. Now he is
short 8,000. Market moves up to 1.25 bid 1.50 offer here comes the buyer now he feels he must sell 8000 here
because "stocks don't go up forever".

Now he is short 16,000. And so on and so on. If the stock keeps moving up, before he realizes it he could be short
50k or 100k shares (depending how big his bank is). _________________________

Finally the market closes for the day and on paper he may look all right in that his "break even" price may be around
the closing price. But now he has to figure out how to entice sellers so he can cover this short. It is important to
note that if this happened to one MM it has probably happened to most all of them.

Some ways MM's entice sellers; Run the stock up with a "tight spread" in a fast market, then "open" up the spread to
slow down the buying interest. After it has "cooled off" for a little while lower the offer below the last trade right
after a small piece trades on the offer then tighten the spread so that the sellers feel they can take a "quick profit"
by "hitting the bid" on the tight spread.

Once the selling starts the MM's will walk it down quickly by only making small prints on the way down with the tight
spread. Another way is by running the stock up in the morning, averaging up their short then use the above
technique to walk it down in the afternoon.

Hopefully after doing this for several days, it will demoralize the buyers. The volume will dry up and the sellers will
materialize thinking that the game is over.

Contrary to popular opinion, MM usually Do Not Cover in Fast moving markets either Up or Down if they are short.
They Short More. They usually try to cover after the frenzy is out of the market. There are many other techniques
they use but the above are the most popular.

This technique works about 9 times out of 10 particularly in a BB market. However that is because 9 out of 10 BB
stocks are BS. Remember what I said above. Most MM's don't have a clue as to the value of a Company until they
get trapped. If the Company has solid fundamentals and a bright future. Then the stock will do very well. And the
activity that caused the situation will prove to even help the future stock activity because it created an audience."


Just food for thought

Money

Market Maker Speaks Out:Ways of a Market Maker

(REPOST)

I was an OTC MM for about 10 years ending in the late 80's. Since then I have been strictly an investor. Since I
have not been that up to date in MM rules I will only make statements that I feel fairly confident are still accurate
regarding these activities. By and large most MM don't have a clue nor do they care to learn, about the fundamentals
of the stocks they trade.

They just try to make orderly markets. When dealing with BB stocks it is very easy for a MM to get trapped into
being short in dealing in a fast moving market. Reason being; most of the MM's in this stock are what are called
"wholesalers" this means they don't have retail brokers "working" the stocks.

So they have to rely on what's known as the "call" from larger retail houses. If a "Big" retail firm like an E-trade calls
up a market maker to purchase say 5,000 shares of a stock, they expect to get an "execution" from that market
maker. If he turns them down, or only gives a partial then the "Big" firm will go to another MM.

If this second MM "fills the order" then that "Big" firm has a moral obligation to continue to give future "business" in
that stock to that MM who performed (his life blood). This will go on until he "fails" to perform and so on.

Contrary to popular opinion the "Big" firms Do NOT necessarily go to the "Low Offer" to fill a buy order (Or high bid
for a sell). They "Go" to who they think will perform to fill the order and expect that MM to "match" the "low offer" in
the case of a buy (bid in the case of a sell). Even though this MM might in fact be the "high bid" and not really want
to sell any more.

As a wholesaler he must perform or he will get a reputation as a "non-performer" with the "Big" houses and will cease
getting "calls" which means he will soon go out of business. I mentioned above that this activity is very significant to
BB stocks. I say this because most of the trades in these BB stocks are "unsolicited" and are done through discount
houses.

With the above groundwork laid, let me try to explain how market makers get short even if they like the Company;
Lets say that a stock (shell) has been lying quietly at $.25 bid $.50 offered. A limit order comes into one of the MM's
to Buy at $.50 for a thousand shares. Prior to this trade that MM may be "flat" (neither long or short any shares). He
fills the order and is now short 1,000 shares. He may raise his bid hoping to find a seller to "flatten" out his position.
But before he realizes it a wave of buyers have come in and cleared out all the $.50 offers. Now the stock is $.50 bid
.75 offered. Here comes that "Big" firm he just sold the 1,000 shares to at .50 with another bid for 1000 at .75. He
makes this print. Now he is short 2,000 at an average of .625. The market keeps moving and now its .75 bid 1.00
offered. Now he has to make a decision.

Just like investors, MM Hate to take a loss. So 9 times out of 10 he will now sell 2000 at 1.00 making him short 4000
but with an average .81. At this time he would love to see a seller at .75 so he can cover his short and make a few
bucks.

But instead the market keeps moving up. Now it is 1.00 to 1.25 and here comes the buyer again at 1.25. He doesn't
want to lose the call so now he needs to sell 4,000 at 1.25 to keep his break even point above the bid. Now he is
short 8,000. Market moves up to 1.25 bid 1.50 offer here comes the buyer now he feels he must sell 8000 here
because "stocks don't go up forever".

Now he is short 16,000. And so on and so on. If the stock keeps moving up, before he realizes it he could be short
50k or 100k shares (depending how big his bank is). _________________________

Finally the market closes for the day and on paper he may look all right in that his "break even" price may be around
the closing price. But now he has to figure out how to entice sellers so he can cover this short. It is important to
note that if this happened to one MM it has probably happened to most all of them.

Some ways MM's entice sellers; Run the stock up with a "tight spread" in a fast market, then "open" up the spread to
slow down the buying interest. After it has "cooled off" for a little while lower the offer below the last trade right
after a small piece trades on the offer then tighten the spread so that the sellers feel they can take a "quick profit"
by "hitting the bid" on the tight spread.

Once the selling starts the MM's will walk it down quickly by only making small prints on the way down with the tight
spread. Another way is by running the stock up in the morning, averaging up their short then use the above
technique to walk it down in the afternoon.

Hopefully after doing this for several days, it will demoralize the buyers. The volume will dry up and the sellers will
materialize thinking that the game is over.

Contrary to popular opinion, MM usually Do Not Cover in Fast moving markets either Up or Down if they are short.
They Short More. They usually try to cover after the frenzy is out of the market. There are many other techniques
they use but the above are the most popular.

This technique works about 9 times out of 10 particularly in a BB market. However that is because 9 out of 10 BB
stocks are BS. Remember what I said above. Most MM's don't have a clue as to the value of a Company until they
get trapped. If the Company has solid fundamentals and a bright future. Then the stock will do very well. And the
activity that caused the situation will prove to even help the future stock activity because it created an audience."


Just food for thought

Money

ROFLMAO. Not exactly how I remember them being posted in the past, but they'll do. Thanks. Still LMAO.

REO. Just happen to have those handy.

500 shares - excel is thinking about getting in, up the bid, entice him.

400 shares - excel is starting to figure out how many shares he wants, keep the price steady.

300 shares - excel put his order in, move the ask.

200 shares - excel chased it he's in.

100 shares - drop this sucker like a rock!

MM signals. Anyone have a copy of the signals the MMs supposedly use between themselves. 100,200,300,etc..
Thanks in advance if you can post them here.

REO

This should give some insite to getting filled...


----- Original Message -----
From: "Freetrade Client Services" <clientservices@freetrade.com>
Sent: Monday, March 29, 2004 12:42 PM
Subject: Re: slow order

> Dear Valued Freetrade Client:
>
> Your market maker was not bidding there, and bulletin boards are not traded on an automated platform. MMs have to call each other to make these trades.
> They tried to hit the displaying MMs to fill your order, but the bids were gone before they could fill your order.
>
>
> Sincerely,
>
> Client Services
> Freetrade by Ameritrade
> Division of Ameritrade, Inc.
>
>
> Original Message Follows:
> ------------------------
> That was my point the order sat there with two mm at the bid at my price and
> it there were no sales going thru. They simply didn't take it for several
> minutes.
>
>
> ----- Original Message -----
> From: "Freetrade Client Services" <clientservices@freetrade.com>
> > Sent: Monday, March 29, 2004 12:15 PM
> Subject: Re: slow order >
>
> > Dear Valued Freetrade Client:
> >
> > The market moved away before you could be filled. We will get your order
> reflected at this time.
> >
> >
> > Sincerely,
> >
> > Client Services
> > Freetrade by Ameritrade
> > Division of Ameritrade, Inc.
> >
> >
> > Original Message Follows:
> > ------------------------
> > I have an order in to sell SHRN @ .037. There were two MM on the bid. Just
> a
> > few sells were going thru and yet my order was not taken. Please look into
> > why my order wasn't filled.

Hey Rawnoc, no wonder his portfolio looks so good. Soon as he buys, he's already up 100%. LMAO

doggone it, you beat me to that post...

I notice the same mistake as well on a lot of the boards.

I did a little test last week-having an odd number of shares 517000 I decided to put only 500,000 on a gtc order @.045 leaving the remaining 17000.Looks like they used my shares. Did they short @ .014 and cover @ .013 with that other 100,000. I'm going to keep testing it this week at differant prices and let you know the results.Maybe the gtc order works for stopping the shorting!



0.013 100000 03/19/04
↓ 0.012 45000 03/19/04
0.013 100000 03/19/04
0.013 75000 03/19/04
0.013 8000 03/19/04
0.013 150000 03/19/04
0.013 583000 03/19/04
0.013 100500 03/19/04
0.013 100000 03/19/04
0.013 50000 03/19/04
↓ 0.013 117000 03/19/04
0.014 60000 03/19/04
0.014 3000 03/19/04
0.014 17000 03/19/04
0.014 25000 03/19/04
0.014 75000 03/19/04
0.014 100000 03/19/04
0.014 25000 03/19/04
0.014 15000 03/19/04
0.014 5600 03/19/04
0.014 100000 03/19/04
↑ 0.014 2500 03/19/04
0.012 315000 03/19/04
↑ 0.012 25000 03/19/04
0.011 50000 03/19/04

do you know basic math????

100% of 1 is 1 but that's not a gain, lol

.02 to .08 is a 300% gain no matter how much you try to spin it.

Raw

100% OF 1 IS 1

just like 1 x 1 = 1

but 200% of 1 = 2

just like 1 x 2 =2

and so forth

go ask Marilyn

Lazarus

actually...

>> if you bought the stock at .02 and it goes to .08 it has gone up 400% if it goes to .10 that's 500%. >>


Common mistake on these threads. You have to subtract the 100% you started with. .02 to .08 is a 300% rise, not a 400% rise. The rise is (.08 - .02) = .06 which is 300% of .02.


>> if the stock is at .075 a double to .15 would be a 100% move from .075 but a 750%increase from .02 >>

650%...


Raw

do you know basic math???

Let's say you bought 'XYZ' @ .02 and for whatever the reason, you're still holding all your initial and subsequent buys. You come home from work one day and find it closed @ .075.... that's over 300%.... The thing has already given you over 300%.... in order for it to give you 1 more 100% it must "DOUBLE!!!"....

if you bought the stock at .02 and it goes to .08 it has gone up 400% if it goes to .10 that's 500%.

if the stock is at .075 a double to .15 would be a 100% move from .075 but a 750%increase from .02

overall not bad advice -- but since we have the BUY HIGH AND SELL HIGHER CROWD OUT IN FULL FORCE i like to squeeze all i can from them.

Lazarus

OK got it gramps haaaaaaaaaaaaa Yehawwwwwwwww

Afternoon,

If you're gonna play the pennies....

You 'MUST' consider the following!

Subject: 'Leverage' aka 'Money Management'

You must use percentage/leverage, if you do, it becomes your friend.

Let's say you bought 'XYZ' @ .02 and for whatever the reason, you're still holding all your initial and subsequent buys. You come home from work one day and find it closed @ .075.... that's over 300%.... "I think you're starting to fall in love?" if you don't sell some now! Don't get caught holding a bag because you read some faceless and nameless post that said 'It's going to .12".

The thing has already given you over 300%.... in order for it to give you 1 more 100% it must "DOUBLE!!!".... 'hello!'

You're overdue. Sell some of your little boy/girl friend and go to cash and start looking for another 'Lolla Lovely' or "Mr. Wonderful'.

The attributes your new love interest should have should be the following:

1) The PPS should be at least 200% lower than the PPS of the stock you sold.

2) It should meet the same criteria that made you buy 'XYZ'.

3) If you don't find it today......"THERE'S NO RUSH".......'that's why God made tomorrow!'

The more shares you have the more 'bang for the buck'.

"LEVERAGE is KEY"!!!!!

Take care.

gramps

http://www.investorshub.com/boards/board.asp?board_id=2367

Please read the I-BOX!

Beo,
and it can bear no relationship whatsoever to their actually book of orders. I've been told by a brokerage (Waterhouse) that you can insist that they show your order on L2, but it's rarely done.

Beo,

It's the price that they themselves are bidding or offering at. The number of round lots shown is the amount they are willing to fill at that price at that particular moment.

Cap

When looking at the L2 set up, the price the MM show, is that a reflection of the orders that they have on their screens or is it a price set by themselves???

beo

ABTG paint follow-up:

and two days later, good news makes an appearance and runs the stock through .40.

Could you imagine one of the smaller MM getting in the way of NITE. They would be toast anytime they needed help. Also what about this post

http://investorshub.com/boards/read_msg.asp?message_id=2558333

I have been watching very close. I have seen stocks with upward pressure have these numbers come across. There would be say a sale at 100 then another then a correction for 200. Siginals my friends, siginals.

There's probably an element of both cooperation and competition, depending on a number of factors.

imo mms will often work together; moves are far too coordinated in general to be coincidence me thinks. also, i have read (someplace) that if a mm is in trouble (i.e. they're being squeezed by upward pressure on a stock), other mms will come to there aide, and in future, the favor is returned. traders often work together (illegally) to pressure a stock; why not mms?

Painting the Tape, ABTG

over the past several days, i've noticed that mms are painting the tape for ABTG. for example, on 3/16/2004, right at the close, a mm bought a mere hundred shares at .40 cents, five cents above the ask.

why do they do this: my thoughts

it's not for our benefit, that much i'm certain of.

painting the tape really blows the chart up, making the stock less interesting to technical players. notice how that 100 share sale at .40 completely changes ABTG's chart; now, rather then showing a coiling pressure against a resistance level, the chart now looks choppy, like its still consolidating. then, on the 18th, ABTG had a slightly down day, and so the chart reflected the hint of downward pressure, perhaps enticing some selling. by extension, of course, this is misdirection. it's highly possible mms are trying to shake, to capture shares for themselves, in preparation for a run.

nice technique, and cheap too, cost them $35.00 to ruin the chart. it's my opinion that some of the best mms around are working ABTG during this period. its a real lesson for traders, imo.