Replies to post #296284 on Spongetech Delivery Systems, Inc. (fka SPNGQ)

[lbdave]

Given the large amount of short sales each day on almost every stock listed there seems to many different opinions on what's going on. There are several possibilities and opinions as to what it all means.

1) It could be as Mingy states, and someone is continuing to short SPNG heavily at these levels. In my opinion that's not the most likely case.

2) Someone posted earlier that when you buy shares through a certain MM who doesn't have those shares to sell, but are purchased from another MM then those shares are considered short by the broker buying them untill they have been delivered for settlement. Example: If you buy 1,000,000 shares through NITE, and he only has 500,000 shares available for sale, then he will buy the remaining shares from another MM to fill his buy order. The 500,000 shares purchased from the other broker are considered short in NITE's account untill the broker to broker settlement is complete, thus the settlement date. This could be a strong possibility as to what is happening.

3) As we know the MM's have the legal ability to naked short shares to make a market in a security. When there is decent volume on any securtiy they do this many times every day. When we see a stock start to run, and the buying pressure hits the bid side the MM's will naked short shares to help sell volume on the way up. Then we get mad, and wonder who is whacking the bid when the share price starts to pull back. In most cases this is the MM backing the share price down so he can cover the shares he has shorted intra day. We call it a dip or a shake, but it's the MM's covering and/or accumulating more shares before they let the run continue moving again. This is also a possibility if there aren't that many share holders wanting to exit their holdings. This is an issue I wish the sec could find a way to deal with the abuse and manipulation that allowing legal naked shorting creates. I'm not sure if the this could be the reason the short volume is so high on many many stocks, or even if they are covered during the day if they are still listed as short volume since they were sold as such. Just my opinion, but I wish we had the right answers to this confusion lol.