Replies to post #73938 on Koil Energy Solutions Inc. (KLNG)

[MossyOak]

Very insightful and sounds hopeful that DR and their party of 40 mill. dollar investors are very LONG here........JMO

[JoeSmith]

Your post clearly makes sense to me, you have to ask what are the motives for these PP players to be in the market with DPDW. That answer can only be to make money.
Good post and observations.

"if we dip even slightly below the PP buy in of .70 the larger players will step in and support the stock, just as they did this morning in the low to mid .60s."
I know of one small player who did the same today.


My posts are my opinions. Always dd to your own comfort level.

[wweeaazz]

I agree, you know my theory. The easy part to see was the shorting, the toughest part to figure was how they were going to cover. I agree with Prospect being the reason this was driven down but it has still taken selling shares short to do it.

(if any MMs went naked short to facilitate PSEC's (possible) short against their block of recently converted warrants, these MMs may now be in the process of covering. as they do so, i would expect to see us rally off the bottom. )

In order to cover they have to buy the shares back... My hope is that noone will sell their shares on a dip and help them create panic selloff which i think they will attempt. If they can create a panic they could cover a huge chunk in a short amount of time.

Also, they have room to 1.22 to cover, noone knows what they hold and at what levels but we know that is where they started putting a lid on the stock. SO i think people should keep this mind when they think they can sell a pop and buy the dip. It may not dip and when you sell you will likely be helping them cover.

Dont even think about flipping or selling under 1.22, thats the line in sand in my opinion. My guess is they (mm's short) wont want to be holding a huge amount short come 9/4/08. But in the meantime anyone who sells should assume they are helping them cover.

All imo.

[SageWise]

brikk, good post. Also to this

"with this as the current backdrop, let's assume a worst case scenario (as one poster mentioned) where private placement shareholders might be shorting against their own blocks of stock. why would they do such a thing? essentially this strategy would be taking at most a 100% profit, and then killing the goose that laid the golden egg. DR invited these investors to the party, and that would be taking away the punchbowl imo."

I totally agree. In fact it makes no sense to me that an investor who got in for a large (or any) quantity of shares at .7 would want to short this to cover with the shares they have. IMO that is a zero-sum game as every penny they make on the way down on the short is lost on the long shares. In PSEC's case it made sense to lock in a value of $1.2 (or close to it) with a short position that could be covered with the warrant shares (which were priced at .507 but essentially zero cost basis after the cashless exercise). It is a moot point as to whether PSEC actually planned / executed on that strategy or if MMs took advantage of their need (?) to sell on August 1st and brought us down to get those 2.6M shares on the cheap. Either way, I see .7 as a solid base to build on and once the flood gates are open after the "quiet period" IMO we should have some good momentum pushing us higher.

[1918forever]

Well put - "We would do well to lean on logic rather than emotion" - Trading on emotion = losses.

I have not yet seeked a max position yet as I am hedging against the dreaded delay in earnings/10K news. With the 9/4/08 deadline approximately 2 weeks after the suggested earnings date, I would prefer to scoop with both hands after earnings are announced while retaining half my position longer term.