Vontrader, I assume that you are aware of the phrase “Buy the...

Vontrader, I assume that you are aware of the phrase “Buy the rumour, sell the fact” which sadly is highly applicable to this end of the market, that is because speculative capital chases stocks on the way up, not those where all the facts are known. When expectations are high speculative money will chase a stock, for example as with MPJ, anticipated positive drill results. As our erstwhile friend, and others have pointed out, a profit is only real when realised, to do that requires that the stock be sold and this is most likely to be when an announcement is made. Announcements are the life blood of the market they also provide traders an opportunity to unwind positions as volume spikes. Once the facts are known however speculators will often sell and lock in profits. Depending on how far a stock has run up prior to an announcement often determines how much pressure it comes under after the event.

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