Of course micro-caps like Deltron will sell shares to raise cash; I'm not insinuating that they don't...I'm telling you in this case they did not!
Let's say, hypothetically, that it was Deltron's intent to sell shares because there was a need for cash. Then don't you think:
1) They would not want to sell shares .0001 to .0002 above such a strong support level like the .0007 to .0008 levels? Maybe if the price had been hovering around .005 then I could see them doing it but not down here!
2) They would have crafted a series of a 2-3 PR campaign over a 3 week period in effort to get the price up to a much higher level and then sell? Their last PR that was not for quarterly/annual results was in November so they are clearly not the types who play the fluff-PR game in an effort to spike the price.
3) If they didn't want to go the multiple PR route and thought they'd issue just one and then sell...then wouldn't they have crafted a much more bullish PR talking about much more market potential? If one has done a modicum of research on Deltron then they are well aware that there is a MUCH more bullish story they could have told. This PR wasn't bad but it was much more to appease the nervous longs who keep calling the company asking when the next PR will be then an attempt to cause a spike in the pps.
4) I think it is safe to say that most if not all of us, and I'm sure the company as well, were anticipating a much stronger price action. I first noticed the 9 mln share blocks shortly after the open. If the company intended to sell today then they would have waited for a pop in the share price and not have been selling right out of the gate for the most part. They would have waited until the early afternoon letting the pps get to the mid to upper teens and then sell....not doing it right after the open.
This was much, much, MUCH more likely a case in which the NITE market maker (for example) might be short as much as 60 million shares going into the close yesterday. He sees the PR after the close yesterday and knows that there will be buying pressure today. Knowing that the PR should bring the flippers out of the woodworks, he shows size volume on the offer and asks one of his buddies at one of the other brokerages to do the same (they have arrangements like this where one helps the other in these situations.) So most flippers see a wall of shares on the offer and decide to sit this one out think there is easier money to be made elsewhere. If there were a bunch of flippers in the stock then the boards would have been inundated with "to da moon, Alice!" type messages. The few flippers who did get in at .0011 are panicking late in the day and dump their shares taking the small hit.
Again, I'm not saying that micro-caps don't sell shares...they do! This just wasn't an example of them having done it! If it was their intent to sell shares they would have tried much harder to get a pps pop before doing so in order to sell shares at a much higher price. It would have been too easy for them to do it, as well as foolish NOT to, if that was their intent.
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