RE:Understanding shorting sell and CXRHey Dan,
I chat with a lot of novices. The general public are novices especially against the sharks on the streets and these boards.
Best option you: HOLD! Don't sell, don't buy.
And if you really want to do something, Buy here. So say you put in $5K at $60, put in $5K now at $30, your average will then be at $40 per share.
Once the stock hits $40, look to see if the insiders start selling, they won't. Once it hits $50, they might start but most only sold at $100+. If you don't want to risk it, set a sell price at $48 or so as soon as you load up. That puts it automatic and keeps the shares out of the shorter's hands.
You can bet that Canaccord clients have no clue about this....
Now, to answer your shorting question. a shorting algorithm (programmed into an ATS computer) might be something like :
1. Put a ton of shares for sale at the ask to scare level 2 watchers, called a "fake wall". Done deeper further down.
2. As the bidders get nervous, they go away and short sells into the weak bid driving down the price. The price goes down when the orders are filled at the bids.
3. Algo moves the fake wall down, go back to #1 and repeats.
That's a very simple algo. I know a guy who worked for a bankster as a top programmer because he came up with a new algo. He was a star got moved around the world, all expenses paid yada yada. Markets adapted, algo became bad and he got the boot. Guy is so freaked now, doesn't touch the markets and he's not doing too well. The markets chew up people and spit them out like trash.
That's why watching L2 (except just before open) is of limited value because the brokerage "professionals" and algo programmers know what investors and traders are looking for and "play with it".
The saving grace here is all these short sellers have to buy back. That's called a short squeeze and at 11% short interest on CXRX listed in the US with so little volume, the full reversal will be felt.
The short squeeze is what create the massive rise from $25 to $50 in not time last fall and what we'll see again here. Not an "if", it's a when.
Both true investors and management have to keep their heads and hands steady as these clowns dance around with mind manipulation techniques. Formidable force until you realize the clowns have nerf guns!
At this point, you need patience and a wet suit because we might go lower. A favorite of short sellers it to take out investors using stop loses so don't have them on a manipulated stock like this because the downward pressure is instant within minutes. Look at the fall action on the charts to see it. Spectacular and the setup now is the same.
Lastly here, if Dan is in fact your real name, don't use it here. These short sellers guys are crooks, not to be trusted at all. The bullboards are like walking in a halloween party filled with pickpockets.
You'll have a good time, have peope get close to you but your cash will be gone.
And if you were born in 1962 and are bald.... never ever use your account again. Ask stockhouse to change it. You made a mistake.
Danwesker wrote: Hey guys,
I'm a pretty new retail investor and just wanted to clarify on short selling because it has been mentioned so many times on the board.
I think I understand the general concept of short selling but please correct if wrong. It is when someone borrows shares bought by someone else to sell at a lower price. The short seller makes money when the price goes down.
I'm just trying to understand from a fundamental level, how does short selling put pressure into making a stock price go down? For example, a stock price usually goes up when there is greater bids then ask, greater demand so more buying and willingness of people to pay higher stock price. How does it work for short selling and how does it influence the stock to go down?
Full disclosure on my end, I bought CXR shares at $60 last year and then it was a massive drop. Currently holding at a pretty big loss, I'm just trying to figure out what is the best thing to do right now:
A) Hold and wait till it reaches $60 or higher then sell
B) Buy at current price or lower to average down
C) Sell now and take a loss
1) What do you recommend and reason?
2) What are the bullish and bearish outlook on CXR? Such as what growth potential, return vs risks, debts
3) Please feel free to contribue any other information you may find helpful, thanks.
Dan