Trading Analysis - 23rd Jan 2019


23 January 2019


Ohh goody something to get our teeth into at last. After an 'interesting' opening auction trade of 50,001 shares at 39.60p which I have conservatively marked as a sell we have a few minutes of quiet and then at 8:06AM the first of a series of 50K Sells. another less than a minute and a half later. Then two minutes after that a 30K Sell (a quantity chosen precisely as it is the Normal Market Size, which must be honoured by Market Makers) and then 15 seconds later another 50K Sell.

I wonder it all these trades are related. I wonder if they are sells of real shares or a short seller. This 180-230K of share sells has a big impact of reducing the net trade position to c. minus 285,000 within only 11 minutes of the market opening. 

And we've only just got started. There are further 50K Sells at 8:13, 8:29 and 8:30 but despite this the strong buying produces a neutral trading position at around a quarter to nine. Within 10 minutes another large Sell - this time of 80,000 shares is dropped in, but this time the MMs seem to have spotted what is going on and this one is dropped in a 37.50p - a full 0.5p below the advertised Bid at the time.

No problem there's plenty of buyers standing in the wings ready to take advantage of these sale prices. There were complaints of buyers not being able to buy even a few thousand shares at these giveaway prices - of course note it is a pure tree shake designed to get weak holders to sell up.

Despite the obvious recover after this drop Mr 50K at 9:02 and 9:10 - no matter the excess of Buys exceeds 300,000 and continues to grow. Strong buying from Fatbanker and others after 10AM eventually pushes the nett trades position over 1 Million.

The nett trade position would have continued to grow had it not been for the return of Mr 50K at 10:33, another 30K Sell at 11:07 and then two more 50K Sells at 11:30 and 11:40. By this time the nett trade position has reached more than 850,000.

Aided, perhaps by a 'useful idiot' shorter, the MMs are maybe looking to get back to their average daily excess of Buys of 500K, after a couple of recent lighter days. Buys 1.9M vs Sells 1.0M at 12:50PM.

End of Day

After 1pm there was little further to add - the trade balance barely shifted.

A little excitement at a quarter past two but I'm not convinced that spiking the Bid to 39.30p for a single trade indicates that that trade is a sell at that level - the outlier Buy at 39.90 is quite small and looks like it is entirely artificial at that price. A 100K Sell is dropped in just before 3PM but this is not enough to prevent the end day trade position to finish with an excess of over 845,000 Buys . Totals are 2.11M Buys vs 1.27M Sells, of which I estimate 350-400K look suspiciously timed and may indeed be short Sells (i.e. have to be bought back at some point in the next few weeks - just before the potential end of a share sell overhang and dividend policy announcement, are they mad ?)

This article only conveys the personal opinion of the author. Whilst every effort is made to ensure the content is accurate, we cannot guarantee the accuracy of the data shown. This article does not constitute professional, financial or investment advice and must not be used as a basis for making investment decisions.

Site content is not authorised by the FCA and you are not safeguarded by the Investor Protection measures of the Financial Services and Markets Act 2000. See our full disclaimer