DD Support Board and Research Team

[DragonBear]

Good points. But here's my theory:

So they short shares as the price climbs

A MM doesn't short shares as a trade for themselves. They may have to short in order to keep the bid-ask spread stable in very high frequency trading periods. But we're talking about Pink stocks where transactions are not numerous, and it doesn't take much in $N for a single investor to spike the volume of a 00n stock.

As Janice just pointed out, the computer is the MM. You just don't have people MMs drooling over pink stocks, plotting trading strategies. That's just not the function of a MM.

What you are seeing are individual penny stock investors trading against themselves. Where a couple of trades execute and some penny stock promotion forum sends red alerts out of the kazoo based on some abnormal increase in volume or PPS movement. Then some stock flipper sells, the PPS goes down, and forum posters claim the evil MMs are manipulating the stock. Wash, dry, rinse.