Ann: Impact of BBY administration, page-11

Hi mop,

It was more just a throwaway comment (dream) as I don't think it will go that low (or shouldn't) for the quality of business that it is.

But there is the argument (and I've definitely seen it happen over the years) that significant gaps on a chart tend to get filled at some point or another and they can act as a bit of a gravitational pull either up or down. I imagine that's a result of technical analysis becoming more prominent in the market, being programmed into trading algorithms etc. Could also be that significant gaps indicate an inflection point in the company where strong volumes will have been traded and so create a pricepoint where those market participants are willing to sell as low (or high) as. e.g. look at the massive volumes on GBT around the gap and think about that in terms of all the new money that would have entered the stock around that price. Generally, investors fear losses more than they enjoy gains so it stands to reason an investor who entered around the gap price would be willing to sell down to as low as the gap price, but not lower. With a little help from trading houses, who have the funds to push the price lower than it fundamentally should go, you can get a snowball effect and before you know it, you've closed the gap. But due to all the money that entered around that price having now exited, liquidity dries-up below that level and price recovers.