Replies to post #33781 on DD Support Board and Research Team

[SRV-90]

This is where the theory is put to rest:

Mms know that people will buy into the publicity and excitement from the promo.
Mms know there is a limited amount of existing sell orders.
Mms know that the frontloaders/diluters will sell when volume comes in and most likely continue to sell at any price until they are out of shares.

No, the MM's don't know what people are doing about these front loaded promoted POS stocks. How would they? They are too busy looking at the big boy stocks and let their computers run their programs to facilitate the order.

This is what gets me is that people actually think MM's pay attention to this sort of baloney.

[janice shell]

Why would the MMs know any of that? Most of the time, these stocks are just tickers for them. And most of the trading is done by machines.

[DragonBear]

Good points. But here's my theory:

So they short shares as the price climbs

A MM doesn't short shares as a trade for themselves. They may have to short in order to keep the bid-ask spread stable in very high frequency trading periods. But we're talking about Pink stocks where transactions are not numerous, and it doesn't take much in $N for a single investor to spike the volume of a 00n stock.

As Janice just pointed out, the computer is the MM. You just don't have people MMs drooling over pink stocks, plotting trading strategies. That's just not the function of a MM.

What you are seeing are individual penny stock investors trading against themselves. Where a couple of trades execute and some penny stock promotion forum sends red alerts out of the kazoo based on some abnormal increase in volume or PPS movement. Then some stock flipper sells, the PPS goes down, and forum posters claim the evil MMs are manipulating the stock. Wash, dry, rinse.