"Sadly day traders got a hold of this one and might have scared a few people out."
Nope, I can't agree....all stocks attract day traders during reratings...they are an essential part of the process, but they don't get trashed back to earth like OOK did unless their us something wrong, or they are nothing but fluff and bubble.
Today is an example of the fallout...the only DT's in this today were the stock specific type...that is, investors that trade the edges of their investments, investors that treat their positions as free floating investments, or ex holders (often burnt) who pip in and out for points.
Some of these are often close to the company in one way or another...some no doubt also posting amongst us on HC.
The real DT's, the ones that collectively flood into stocks like OOK to ride the coat tails of genuine reratings, and who push the stock to major highs as they buy and then down as they exit (but leave the stock at much higher levels after they have exited), will not touch OOK now after recent performance, for fear of being preyed apon again.
At least not on today's announcement.
These types were all over OOK in its run from 5c to 17c.
No...it wasn't the DT's that scared people from OOK...on the contrary, it is OOK that scared off the DT's.
Recent performance shows all the signs of price grooming (manipulation) by someone (or a group) possibly close to the company...at least closer than the average investor.
As a result of their games, the OOK "investment brand" is being damaged...instead of trading at a value premium (ie. low risk with future value bough forward), OOK is now trading at a value discount (high risk with future value discounted).
This means future capital raisings are likely to be undertaken at lower prices than they may have otherwise, resulting in higher dilution to shareholders.
To undo this situation will not be easy.
As I have previously discussed, in my mind management had every opportunity to lock in the recent rerating and embrace the new interest...to forge a new baseline.
But inexplicably didn't...in my mind to the stocks detriment.
Anyway, one final thing...
We should not confuse share price with company value.
Price is what we pay, value is what we get.
At present I see a major disconnect between the two...the stock is being priced by the market at a significant discount to fair value relative to its peers, AND relative to the future value of OOK.
It appears to me the market is discounting OOK, not for its assets, but for something else...
For example, today is an example of the sort of chicken and egg moment we have seen many times now in OOK, that scares off investors...so, which came first, the announcement or the rally?
Confused?
Maybe the question becomes easier to understand when we realise today's rally, and the pressure point numbers that controlled it (ie 7.4c) were actually consummated last week, with the triggering of stop loss selling and accumulation by certain others.
Queue the announcement...
The "buying interest" pre market today was completely manufactured to entice a market response - there is no way todays announcement engendered major buying interest and a 35% gain at one point, from genuine traders.
Likewise, the selling pressure in the lead up was equally forced.
It is being played with.
The final part of this game is the pump...to offload the stock that was picked up from the recent stop losses. To do this they need an announcement...to hide behind...otherwise the ASX would ask questions.
I note the Company has had queries before.
Now let me make it clear...the Company may have nothing to do with this behaviour, even though someone close to them may well be behind it.
It is however encumbent on the Company to monitor such behaviour and help reduce, and where possible, prevent such activity - they know how to do this.
Else they risk the market blacklisting their stock as a no-go zone.
Today a case in point; it looked like big market interest today...but i am pretty sure it just appeared that way.
Someone out there will know what I am saying.
Cheers
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