Short sale in last few days, page-10

Here is the broader context:

I believe that, as far as EWC is concerned, we certainly live in interesting times:

Firstly, EWI and one director buy additional shares.

Secondly, two independent directors resign.

Thirdly, daily shorting volume is rather high (ie. between 50% to around 75% yesterday).

Fourthly, share price is declining even further, losing any relation to value of share.

Fifthly, market depth is turning around substantially, from around 1:2 (buyers vs sellers) to over 2:1 (buyers vs sellers). In addition, large buy volumes are near current ‘strike rate’.

What is behind all this:

Firstly, a belief, backed by money, of EWI and one director that EWC has a very profitable financial future. (The remaining directors share this conviction).

Secondly, a realization that EWC’s progress re: major project completion cannot be halted (2 independent directors who did not share EWC’s business approach resigned).

Thirdly, shorters believe that time is not their friend (hit it hard now, so that they can buy back a few shares at a ridiculously low price, because finanlising finance for EWC’s 3 major projects cannot be too far away (see page 9 of 2015 preliminary final report)).

Fourthly, short time frame to exploit uncertainty created by resignation of 2 independent directors and knowledge that ‘turnaround is imminent’, leads shorters to act fast and decisively and instill fear amongst existing EWC share holders (window of shorting opportunity will close very shortly).

Fifthly, buyers line up (admittedly at extremely low prices) because they know that points 1 and 2 above will become reality in a few weeks/months.