Trading Analysis - 24th Aug 2018

Alfacomp

24 August 2018

End Day Update - Scroll to Bottom

Trading on Friday morning has been confounded by the appearance of 2x 250K trades, assumed Buys, that lie significantly above the trading band for the day. These are shown highlighted in green on the chart below.

Both of these trades were reported 1 hour late. But there was fairly minimal impact in either Bid or Ask. Furthermore this appears to leave the nett trading position with an excess of 900K more Buys than Sells.

This nett trading position may be expected to go significantly positive with little impact on the SP if one believes that the Market Makers built up a significant stock of cheap shares following Tuesday's induced panic selling. However it seems strange that quite such a large premium might be paid for the first 250K share trade.

My suspicion is that this trade will miraculously be reversed later in the day - we shall see.


Update 3.45pm

The appearance of 5 more trades of size 250K, including 2 at precisely 14:01:27 is naturally intriguing. The pair recalls memories of the Erongo Sell down - when we concluded from the data that end-day trade pairs were constituted of 1 sell and 1 inter-MM transfer. Perhaps similar shuffling of shares is going on today.


These trades, marked in green seem scattered all over the Buy/Sell range, and at points mid-way between also. If we discount at least one of the trades at 14:01:27 as a double counting then by 3:30pm we end up with a nett trade position of approximately 900K more Buys than Sells.

Where are the Market Makers getting all these shares from ? The stock from Tuesday is, I believe, exhausted as they did appear to have to raise the price yesterday in order to obtain stock. This only really leaves warrants being pre-sold as a source of stock. The delayed 750K trade from yesterday may have been the start of this process, it will be interesting to see how long these 250K trades continue.


End of Day Update


At 15:17 a further delayed 250K trade appeared - again appearing to be a sell, and despite this the end day nett trade position finished at +750K more Buys than Sells.

How can we understand this ? It does appear that the last six of the 250K trades occur as pairs - none more than a minute and a quarter apart - thus we might consider that, like Erongo, one of the trade pair is simply an inter-MM transfer. Removing these 3x250K sells from the nett MM<->PI trade balance does not bring us back into balance though - in fact it makes the nett trade balance increase from +750K to +1.5M more Buys than Sells. 

The most obvious interpretation is that these sells are coming from either Atlas's share holding or as pre-selling of their remaining warrants, followed by a degree of shuffling between Market Makers, possibly to disguise what is going on.

 

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