Replies to post #258773 on ERHC Energy Inc (ERHE)

[Krombacher]

What's odd is that they are including the volume in the closing price, even though that volume was after hours. And yet they don't include the value of the trade.

While I agree that all this doji moji candle stuff doesn't really mean much...I think that there is some significance to the T-1 trade.

Someone out there is buying...and willing to pay a premium, a big one. They know something...no one pays a large premium unless they are darn well sure they can garner a higher price than the premium they pay.

The MM was goosing around for every seller throughout the day to fill the order, and I really doubt he filled it totally. 400 or 500 thousand shares is doable without placing through an MM...the actual order size I'm thinking is much bigger.

The above may be wrong.

Krombacher

[Krombacher]

The action is really fascinating:

Volume last couple of days:

May 24, 2012 1,346,600
May 23, 2012 751,000
May 22, 2012 522,100
May 21, 2012 132,900
May 18, 2012 101,600

It's quite a spike in volume, and if we do decide to ignore the closing price because the MM's are apparently manipulating them (or some have even been painting the tape lately), then consider the highs of each day since that number is harder to manipulate:

May 24, 2012 0.14
May 23, 2012 0.14
May 22, 2012 0.11
May 21, 2012 0.10
May 18, 2012 0.10

So whoever it is on May 23 and May 24 is not only hitting large volume buys, but is willing to chase it some 40% higher all the way to the high of the day.

I highly doubt any longs here are doing that...I'm sure most are already all-in and newbies probably haven't noticed yet as it is too early.

In my experience, when someone rushes in and says I'll pay you 40% more for that "thing", either that "thing" is a matter of life and death or that person knows they'll make more based on some news event.

Just sayin', but I could be wrong.

Krombacher- the above may be wrong

[Krombacher]

I'm even going to make a prediction for today, and I'm not even going to use TA to do it...just using my common sense.

Let's say, hypothetically, someone out there, perhaps eating some fish on a drill ship in the middle of the ocean, is sitting on some interesting news, which will be hard to trace as "insider trading" because Total is not ERHC and ERHC is in a whole other block, plus you have international backgrounds and who knows what...

...I would never ever advocate insider trading, but perhaps someone on Sao Tome island doesn't give a flying fish about it...

so let's say that's the assumption.

Ready?

On Monday, in America it is Memorial Day. The markets on Monday are CLOSED!!!

Whoever this guy is floating around on that drill ship must be panicking after having learned that not only could that news leak out over the weekend, but that news could even make it to investors everywhere on Monday (which is a work day every where else in the world) and result in a rush to buy shares Tuesday morning.

NO WAY IN HECK! IS THIS PERSON WITH THIS NEWS GOING TO WAIT UNTIL TUESDAY!! Not when that news could be released before he has a chance to finish buying his shares.

Hence my prediction: Today will be a HUGE buying chasing day with millions of shares traded. This guy is just not going to risk a long weekend, in my opinion.

But the above is probably fantasy and could be completely wrong...

Krombacher

[Krombacher]

Or let's take another look at this...

...is it possible to trade a million shares over say a 2 week period, while tip-toeing around the MM's with little impact to the share price?

I think so. You buy a little, let the share price go up a little, maybe entice a few investors with that higher share price to sell a little and take money off the table.

And before long, you might be able to acquire a million shares with little fuss or muss.

Would it cost you a lot in commissions? Meh, at about $10 at most brokerages, and maybe even if you piece meal it over 20 trades, that's only about $200.

Compare that with paying this 40% premium from current share price levels...heck, we even saw that some investors were willing to sell to the MM for 10 cents, indicating to me that many still value the stock at about 10 cents...so these mega buyers are definitely willing to pay tens of thousands of dollars above what everyone else seems to think the shares are worth...and why?

Two reasons:

1) They want those share NOW! They can't seem to do a several week long strategy.

2) They don't care about paying tens of thousands of dollars in premium, because they KNOW BETTER. In fact, the more premium they pay, the more CONFIDENT they must be about what they KNOW.

I think something is definitely cooking here...

...but I could be wrong about all of the above.

Krombacher

[Krombacher]

I will, however, concede the possibility that after David Bovell left ERHC, he decided to employ his secret stock buying strategy that he may have used when ERHC acquired shares in Exile...

...and is the one behind the buying activity lately.

Then it would make a lot sense as to why someone would be willing to pay silly premiums.

LOL!

Krombacher - the above is probably wrong, but would be hilarious if true.