Replies to post #55912 on China Growth Stocks

[derek2000]

CCME - Short

I think what you say is true, there could be some short covering on Oct 14 and 15 which was not reflected on the table. But my guess is that the covering is minimal for the following reasons:

1) Shorts are very persistent in CCME: If you look into the historic price table (or stockcharts), the shorts were very persistent. After the stock buy back announcement, the short, instead of covering, actually increased their short position between 9/15 and 9/30.

2) The tide turned way before Oct 13, the smart short could have covered at a low price, but they choose not to do so judging from the data.

3) On broad Chinese small caps space, the shorts had not covered over the period. For example, RINO's short interests remain roughly the same between 9/30 and 10/15 in spite of significant up swing in share prices. Same for HRBN, even after the CEO's offer cash buyback at $24.

4) New shorts after Oct 15 reduce the effects of covering during Oct 14/15. You can "read" from the price action starting from Oct 16 that there are mini shorts attacks on CCME. I can "feel" that last Friday, Oct 22, the shorts are all over the place to drive the stock safely under $15 - there could be a small chance that CCME makes IBD if above 15 last week.