RE: shhhhhh3 May 2023 11:25
I do not know enough about how the MMs operate in order to fulfil buys and sells; i.e. how much stock they carry, what tactics do they employ to encourage buys and sells.
What is blatantly clear though is things have changed since the RNS Friday. A few observations:
- The SP has increased by c.10%
- There does seem to have been an increase in buys - but liquidity seemed to dry up around lunchtime yesterday
- The sentiment on the board has changed, quite a few new posters and also more activity and interest on other forms of social media
Let's take a hypothetical example (as we do not know what is happeneing behind the scenes)
If Mr X put in a limit order of 5m shares at a price up to 2.15p on Friday after reading the RNS. What do you think MMs will be doing?
OR
If Mr Y had shorted Hemo and wanted to close the position on Friday at a certain price - do we think that this position may not be closed yet.
My completely unsubstantiated theory is that MMS are trying their best to fill some orders placed below 2.2p and will keep trying until a tipping point when demand for shares will make it impossible to keep the price down at this level. This is why we see SPs spike as those looking to buy or close a short position have to then act quickly which further fuels the increase in the SP. Most seem to be thinking that this will spike up very soon - and then settle down pending IND approval.
Just my thoughts, keen to hear if others think this sounds likely or if there are better theories or indeed understanding