WOW.If you spend enough time in the market, you see a LOT of dirty games, but this was one of the dirtiest imho. I watchted the trading activity yesterday, and bought a bunch of shares at $19.00. Sold those this morning at $20.00. Re-bought at $19.65 and have now been buying more in this range. Collectively, these will be short term/swing trades for me.
There is a LOT of psychology that comes in to play when these kinds of events happen, and there is certainly money to be made. The first question is whether there is a fundamental problem with the company...some imminent bad news, or pure market manipulation to get a pricing job done. With the news release this morning, clearly it was the latter, which is good news for those wishing to buy.
The reality of the situation however, is still being digested. That kind of drop rattles people, and you have people who now sell in fear, as well as people who get margin calls, and then on the other side, you also have some lingering fear of trying to catch the bottom. That fear leaves volume low, and people who sell, or have to sell, tripping over each other. If you happen to have bid/ask showing, you can see it there too, with unusually wide spreads.
This is a temporary phenomenon. Those who wanted or needed to sell dry up, and buying hesitancy is replaced by greed that the opportunity is now there and is now real.
On all fronts imho, for traders, swing, and true investors, the opportunity to buy at an artificially low (and artificially conceived) price is currently there. Yes, not for the the faint of heart to wade in, but if you get control of the emotional content, and ask if anything has actually changed with the company (it hasn't), the opportunity becomes much more clear to see.