Trading Analysis - 12th Sept 2018

Alfacomp

12 September 2018


 

To be updated during the day - keep checking back as announcements might not be made via LSE/Twitter. The Current trading analysis is shown below

9:39AM

Clearly a change in behaviour today. More than 1.2M more Buys than Sells. Looks like either there is good news to come from the plant, someone has called the bottom, or the Market Makers have decided to cut their short position and try and give themselves a higher point at which to be able to get some shares back.


10:49AM

 

No delayed sells reported yet. 1.7M more Buys than Sells before 11am. A Buyer of 340K shares in the 9am auction managed to get 100K of them but is still on the hunt for another 240 thousand.


1:49PM


Relentless buying since 10.15am has not yielded any increase in Ask, despite the nett trading position increasing from 1.4M to 2.8M more Buys than Sells.

Add this to the 2.8M hole that the market makers have and you reach 5.6M. If at this point the MMs start to walk the price down then it does suggest that they are looking to try and find the shares that they need at less than what they just sold them for - the 'double-up' strategy I described yesterday. 

If not then it suggest that any kind of stock or warrants overhang has been cleared and the price will continue upwards, albeit perhaps now at a faster rate.


End of Day


Buying continued throughout the afternoon - with the spread between Buy price and Sell price narrowing towards 3pm. Just after 3:20pm there was a fairly clear attempt to drive the price down with a series of 100K Sells, first at 20.7, then 20.5, then 20.18 - all within 6 minutes and 10 seconds. The Market Makers spotted this quite easily and dropped the Bid, as they do when they see obvious short-style attempts. This had only minimal impact on the nett trading position as nobody else wished to sell at that point.

The RNS updating on the industrial action appeared at 4:15pm and the SP was quickly marked down by Market Makers in what was essentially a last quarter hour tree-shake - numerous people reported that it was impossible to buy more than 30,000 shares at the low prices available at the close of trading.

A sell of 629,689 shares at 19p at 8:53am was reported after trading finished (marked in green) - this corresponds quite closely to the nett trading position at that time, and also quite clearly corresponds to the point at which the market dynamics changed in the morning. This would appear to therefore signal the end of some sort of overhang.

Further trades of 50K and 250K, priced significantly above the closing price were also reported after hours - these are shown on the extreme right of the chart above. The end day nett trading position ended at more than 2.2 Million Buys more than Sells.

No late reported trades have been reported for any previous days so this figure can be added to the observed nett excess of Buys in previous days i.e. 2.8 Million.

This indicates that Market Makers need 5 Million shares. Either they must be working a large sell - of shares or perhaps warrant presales, which the 8:53am trade may signal the end of, or they are taking a very significant risk by being short of quite so many shares (1 Million pounds worth.)

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