ScripsAmerica Inc. (SCRCQ)

[coolerheadsprevail]

Shorts getting wiped out. Cleaned out here!!!!!

Covering and closing out a short position intra-day using tight stops the way the TUTs are clearly doing is hardly getting wiped out. If you really want to inflict maximum pain on them, then go tell JOSEPH ZAMPETTI and the rest of his criminal CORE PIPE-holders to stop dumping and providing relatively pain-free escape hatches for them.

But it is important for retail investors to understand that TUTs rarely get caught in any short squeeze because they have the resources to not only afford the account maintenance requirements but never get pinched and forced to cover by margin calls the way retail joes do. This is why I stated long long ago last summer when the talk of uplisting first began here that once a R/S takes effect, that TUTs will begin buying in – and that w/TUTs comes the volatility that comes with shorting, because TUTs understand that Risk Management 101 calls for a degree of shorting – not as a direct profit-making strategy the way retail joes and daytraders use shorting, mind you – as part of an overall effective hedging strategy to minimize potential losses in an otherwise speculative long common position.

And it is NOT a coincidence that the surge in daily short sales volume began in lockstep with when TUTs began buying in the past month or so. Retail shorting SCRC? Suicidal, as I’ve always stated, and is NOT happening. TUTs shorting SCRC? Just a standard day at the office, so get used to it and factor this into your investment thesis.

And if you think about it, TUTs shorting penny stocks like SCRC who are on a hell of a bullish run and hitting highs not seen in almost a year is not all that unexpected. After all, shorting is the exact opposite of going long. Just as there are traders/investors who buy on dips because they think they have timed the bottom, there are traders/investors who buy on spikes because they think they have timed a top. And when longs see the sp continue to fall, they quickly sell out again and are content with getting only a little but knicked by a falling knife. Again, similarly, when shorts see the sp continue to rise, they also quickly cover their positions and are content with getting only a little knicked by what can best be called a “rising” knife. Two sides of the same coin, really. To expect one w/o the other is unrealistic and can distort one’s view of the market – and consequently, this distorted and incomplete view of the market increases the risk that a market participant will make an mis-informed decision or otherwise be caught off-guard when the sp begins moves a certain way.

BUT REMEMBER, as I stated weeks ago, although shorting can make retail joes like us nervous as it is occurring, once we see that the sp has remained steadfast – and even rise – we actually want MORE shorting. Why? Because every share that is shorted automatically becomes a share of GUARANTEED buying interest at some point in the future (whether it is 10 minutes in the future, some other point intra-day, or some other day altogether). And that is ALWAYS a good thing.

One final note on shorting: Keep in mind that when it is short positions that are being covered, the buying (although good in and of itself) does NOT add to the base that is being built at that price level. After all, if you think about it, although a share may be purchased at .185 to cover a short position, the shorter who paid .185 for it is NOT holding that share as his/her own share. He/she is RETURNING that share to the original owner who it was borrowed from. So if that original owner had a cost basis of .12, then .12 remains his cost basis for that share – REGARDLESS of whether the shorter had to pay .185 to get it back for him. Reason this is important is that when lots of shorting and covering takes place, it makes it more difficult to assess how much of a base is actually being built at any particular price level.