RE: Deals and sp17 Aug 2018 21:47
Bob, my take is this. Feedback is a tiddler of a share in a large watery expanse of small, medium, large and enormous share sea beasts. As such it warrants almost no time by humans at the market makers. They probably leave the running of it to software algorithms 99.9% of the time. When an RNS comes through they scan it for positive vs. negative words / phrases and adjust the share price accordingly and quickly. When trades come through after the RNS they check the number of buy to sell shares and apply a ratio. If the ratio isn't within the one expected by the algorithm then the price moves. You see it all the time when a large trade appears the price goes up / down instantly in most cases. This is not done by a super fast human at a keyboard, it is done by artificial intelligence (AI). So as per yesterday, the RNS comes out and positive words outweigh negative and the AI moves the price upwards but the the sell on news guys started to sell as the bell went and there was the tiniest of dips as the software made an adjustment for it. By lunchtime that tiny dip in price enticed buyers and they (or their AI software) jumped in looking for a bit of a bargain and the price moved up properly for the first time on trading traffic that day. The AI pushed up and up until sellers appeared to allow MM books to seek equilibrium. And so it goes, the AI works according to rules and is very adept at getting balance most days. It's the days when they can't balance for whatever reason when the roller coaster starts up and the share price adjusts drastically.
On the 15th & 16th Mike Hayball sold 650k shares and we had the late 985k buy - I doubt one would have happened without the other. We need to find a way for long term holders like Mike and Trevor to stop self-sabotaging the share price for it to really climb.
With Trevor we knew he was pushing the price down through malice and I commend the BoD for having the fortitude to not issue good news until he was done and dusted. With Mike they may very well have to do that all over again but this time if Mike wants out then perhaps some orderly disposal can be arranged.
The insane spread is almost certainly down to unbalanced MM books. When books are balanced prices are closer as each firm sits top / bottom of the price tree only long enough to do a bit of trading whilst keeping their books balanced. Snag or dispose of a few shares then move over and let someone else sit top of the tree.
My guess right now is we have at least one, and maybe two, firms whose books are unbalanced and they are trying to tidy themselves up before the quarterly inspection.
It's all a bit frustrating for us little guys and we will have to wait it out until others release / take up shares and allow all the MM's to have balanced books. Once that happens the share price should flow steadily upwards with each exciting RNS.
P.S. I wouldn't be surprised if the same AI software doesn't also trawl these pages too