I didn’t intend to do this until the end of the week, but I wanted to put this out there for anyone who’s looking for a alternate perspective. I think things are getting really interesting and, per me, by no coincidence. I make no guarantees and reserve my right to be wrong, but things are falling into place. I just think many are looking in the wrong place.
I know this will sound crazy… as usual. We are all talking buy outs, partnerships, prescription counts, this deal and that deal. The management is this and Gary is that. Blah. Blah. Blah.
My intention is only to follow the smart money, aka manipulators. They have all the money, time and whatever resources needed to worry about all those things. So, I let them worry about all that and I focus on following them. They have the connections and inside scoop, so why would I waste time over trying to figure out what they most likely already know?
So, with that said, lets forget about all those things and focus on their left hand while they are getting others to focus on their right. To me, the most important thing to come out in the last couple of days is the updated short interest. The other news is just lagniappe, as we say down here. It dropped by the largest margin it has since May of last year. Obviously, this one time drop doesn’t make a trend, but it seem to be inline with some significant events.
This is the same IRWD chart from my last post. I was talking about the upcoming results from their test and how a bad result would really change the landscape between them an us. I do think that is possible, as stated in that last post, but realistically don’t think it’s that probable. Regardless, the point of that chart was to show how SGYP started an immediate decline after the original FDA approval, and IRWD went right into a buying climax which started their distribution trading range. I was making note of the correlation between the two. It was, as if, as soon as the FDA ruling was official, each sprung into action to setup for an eventual trading of places, where SGYP would become the new market leader and IRWD would fall. Not only that, but it seemed to be done with urgency.
Wouldn’t it be fun if these manipulators knew there was a deal on the table to acquire SGYP. It was all just contingent on them getting FDA approval. Once they got it, the deal would commence and take, say, 16 months to complete. That meant the manipulators had to act fast to get out of IRWD and setup SGYP to accumulate it at it’s all-time lows. All this done quickly to be ready for the finalization of the acquisition?!?!? Or, perhaps they did catch wind that IRWD had issues and would have a hard time passing that investigation. As soon as SGYP got FDA approval, they would be IRWD’s biggest competitor and in-line to benefit from their demise. Ahhhhh who am I kidding, I should get my head out of the clouds. Anyway…
I think the main reason for SGYP having such a large short interest is because manipulators shorted it bigly to drive it down as fast as they could, to ultimately get to this accumulation. On the IRWD side of things, they have been shaking it hard lately. They look like they are about to start, or started, their markdown phase and are trying to shake out any last demand. Also to create weak hands to help fuel the run down once they realize they are on the wrong side of the trade and sell. At the same time, SGYP seems to be turning a corner, which could lead to a markup phase for us. Hence, we shall cross again as we do a little switcheroo, this time us crossing above them.
The problem the manipulators have though, is they still have this large short position. If indeed an IRWD markdown is imminent, possibly even in progress, and SGYP is to rise to meet them half way, the manipulators first need to get rid of that short position. Around 10 million shares were covered in the last two weeks, but around 66 million shares remain. We can assume that not all 66 are manipulated shorts, some of that is retail. Around this time last year, when the shit hit the fan, the short interest was just under 40 million. Let’s do some wild ass guessing and say they want to get the short interest back to that 40 million level before moving back up. So, let’s pretend they still need to cover roughly 20 million shares before letting it go, and they probably need to do it fairly quickly. That’s all a bunch of complete speculation, but it helps visualize the situation.
Manipulators still have a butt load of short positions. They can’t unload it in a way that would effect the market. Too much covering at once would cause the price to rise, and you can bet all your SGYP shares that these people, if they have a say so, aren’t going to let this market go up before they can cover all there shares. Part of the reason I think the 10 million shares covered over the past two weeks was manipulators is for that very fact. They were covered strategically in small increments as to not cause the price to rise. If that were retail covering it would have been more panic covering related to some news that would have driven the price up quickly.
Another quick note about volume. Just to add to the sketchiness of this whole theory, let’s talk about dark pools. Huh? Yes, that is a real thing… dark pools. There click that and see for yourself. It’s a very shady name for a very shady practice that fits right into the notion that this is all just a paranoid conspiracy theory. Thanks to whomever gave it that name for giving my ideas even less credibility! Basically, it is a way for manipulators to make transaction on other private exchanges. By doing that, the volume of such transaction isn’t reported on the public exchange that we see. So, they can hide that particular volume. Just what we need, more ways for the manipulators to manipulate. So, if you ever find yourself scratching your head because the amount of volume posted just doesn’t jive with the price movement, think dark pools. Ok, now back to it…
Today and tomorrow are presenting the manipulators with an opportunity they most likely already planned on. The only way they can cover the rest of their load quickly is with really big volume. The only way to do it without driving the price up is to create fear. The fear will create volume as people panic to sell, which will drive the price down. It’s the perfect opportunity to cover a large amount of short positions. The volume will already be high with panic selling and retail short chasing. The manipulators can then start to cover in bulk. It would, at least, double the volume and their covering will only absorb all the fear and maintain the price rather than drive it up. Or, drive it up after a good markdown to end around where it started.
I mentioned earlier today, after the sale of the rights news hit, that the price would probably go down, or Friday after earnings. I’m tempted to say the news today was by design, or at least the way it was presented with very little information concerning the terms. That doesn’t really matter though. What matters is that the price was driven down, again by design. The short volume today was over 60%. The volume was still relatively light, so 60%+ isn’t as big a dollar value as it sounds. It was driven down by manipulators to set up fear. Nothing makes you more scared than to get good news and the price still falls. It makes you question the future and state of the stock. I looked on the boards a few hours ago, and their plan seemed to be working. You can smell the panic as the wave of negativity hits, all to fuel fear.
I’m thinking post earnings is where they make their move to cover in bulk. Today they set the stage so people are on edge. I’m expecting tomorrow will continue the fear mongering. Then one of two things will happen after earnings. First, we get a quick markdown, possibly even to new all time lows. It could all happen Friday, or spill into next week. After we get to a scary low, the manipulators start covering in bulk, which sends it right back up. If all that happens on Friday, it would end the day and the week with a nice hammer. By the way, that is also the definition of a spring. A quick markdown below some solid support, then a quick rebound. It could be the beginning of a sustainable uptrend, or at least a big bounce back up to some established resistance.
The other possibility is that we get a ton of volume Friday, but little move in price. That would be because the manipulators are just absorbing the selling pressure with covering as it comes. The two will cancel each other out and leave it with little price movement, but huge volume.
So, there it is, my two cents in a lot more words than I intended. As always, I don’t guarantee any of this will happen, it’s just how I see it, and my eyes are, without doubt, looking down the road less traveled.