Smell the Truth
The simple truth about the trading on Friday is that the pps and volume were performing just fine up to about 7.5M shares traded up to about .0028 for gains until about noon. Then in the 12 o'clock hour, there were two trades for about 5M shares at .0021 which was quite a leap down from the last trade at .0028, a 25% drop on just two trades. At that point the ticker had traded about 12.5M shares and after those two trades the pps slightly recovered on lower volume for the rest of the hour up to about .0024, just a small intraday loss. Then for the rest of the day from about 14M shares traded to about 20M shares traded the pps slowly dropped trade after trade down to .002 on about 6M shares traded. That is the real truth of the matter yet the bashers are out in full force this weekend with "I told you so"s and all other forms of negative ranting, apparently because they feel vindicated that because the stock was down 20% on a day with news it allegedly means that investors are giving management or the company zero credibility. This thesis is completely FALSE.
Smell the truth, the fact of the matter is that a trader or investor with about 5M shares or half of one percent of the total company shares dumped two large share blocks in the middle of the day into a market with hardly any buyers and a very weak bid. This meant that MMs probably had to pickup the majority of those blocks and then hock them off in parts for the rest of the day. Now we all know the MMs control the spot price and they do not accumulate large positions, they always attempt to stay net flat, therefore chances are they shorted the 5M share block and pushed the pps down for the rest of the day covering at lower prices as well as selling off chunks of the 5M block at slightly higher prices than their .0021 cost basis for those shares. Only about 1.5M shares were dumped at the end of the day lower than the .0021 price level of course at the last 20 minutes of the trading day when virtually no buyers were around to bid the stock up, these shares were probably the rest of the position they wanted to get rid of in order to get flat. They already had probably sold much of the 5M block they picked up at .0021 for .0022 and .0024 to buyers for the rest of the day that came in after the noon blocks. Net net, they probably came out of the trading day with a small gain however the stock took some damage. Why? How? Because of sellers willing to hit the bids for large share blocks and not being patient and ramping out over time on the ask. Also note though that the same tape could have happened just with the MMs shorting 5M shares and dumping on the bid those borrowed shares, which does happen occasionally, however I dont think it happened like that in this case because the final end of day price of .002 was too close to the cost basis of .0021 for that share block to make it a lucrative transaction. It is very interesting also to note that just over 6M shares were sold short on Friday according to the FINRA figures which makes sense in relation to this hypothesis. All of this means that only about 0.5% of the total shares in the company were probably dumped midday and then for the rest of the day the MMs were grinding down in order to get a net flat position while still attempting to make a profit for the day in the midst of low volume and a scarcity of bids.
The conclusion is that with such a thinly traded low volume stock with huge spreads, the spot price can go anywhere on any given day depending on who wants to get in or out on any given day and how large their position is versus how many existing buyers and sellers there are and how adamant they are about getting out, coupled with the behavior of the MMs trashing the stock price just so they can get their daily profit for services rendered while keeping a net flat position. The price action means nothing with only 1% or 2% of the total company shares trading yet the bashers of course love to swarm in with negative rants all day every day on the internet whenever the pps takes a hit. For obvious reasons bashing after a day when the stock is down 20% or more makes whatever they say right, as if they have always been right about the story. Notice on days when the stock is up 30% they are no where to be found. The truth is on Friday the stock fell one half of a tenth of a penny per share and for the first half of the day it was up by almost the same amount. The stock could have ended up with a gain for the day just as easily, so the fluctuations are to be expected and wherever it ends up for the end of the day means absolutely nothing. Of course though the bashers love for it to end down big late on a Friday because it gives them ammo to bash all weekend because all of the longs who do not understand these points get worried and concerned about the stock over the days when its not trading but still down big from the previous trading day. Does a single down day of trading mean that the bashers have always been right about the RFMK story? No, a bid down day in the red means absolutely nothing and the fluctuations just come with the territory when investing in a company trading on the pink sheets.
Smell the truth
GLTA!
$RFMK!
