Had to close the position today after 10% drop in price. Can't figure out what's wrong with the stock. MMs playing or some serious fundamental issue? Cheers
I am a holder. I can't find any news on it. My Barclays account says that today's 4 largest trades today have all been buys. I try to resist selling on price falls which are not based on fundamentals, so am planning to keep holding. Has anyone else got a reason why the price is falling?
to be honest it makes no sense, it peaked at around 170p and dropped this much without any bad news.
only thing I can think off could be perhaps a huge amount of sells recently, as people who invested early are cashing in causing the price to drop?
the metrics however look really good, PEG etc. so would even be a great buy now though I have notice its P-Score has dropped....
Someone was selling off shares in 50K chunks roughly every hour throughout the day with delayed reporting ("OK" trades) by an hour each time, so that the trades looked like buys by the time they appeared. Each chunk was usually broken into two separate trades.
Of course the interesting question is why they are selling. Are they getting out for some reason, or are they just top-slicing a rather well-performing share?
I recon it has been hitting more and more wider stop losses and people are coming out to let the dust settle. No bad news to indicate any reason why they are still dropping.
Hi Nick
Thanks for your post. Please can you let us know how you came by such detailed information on the share trades? I don't doubt that it is genuine, but I would love to know how you came by it.
Is this from level 2 data? If so, who do you use for it and would you recommend them? Do you find it advantageous to pay for such information?
Sorry for endless questions, but would really like to know the answers.
"Level 2" is the order book (unmatched orders). The record of trades (time and sales) is free on the LSE website for the current day, where can see those big trades at a discount. If your broker offers it on their platform, they shouldn't charge extra for it.
Cig,
Your reply is much appreciated. I will put that section of the LSE in my favourites. It shouldn't be too difficult to interpret the big deals which have gone through.
I just looked at the trade history using Moneyam (free registration). Didn't need level2 data. Here are the trades between 9:00 and 10:00 for example:
| Time | Price | Quantity | Type | Bid | Offer | B/S | Tot Buy | Tot Sell |
|
You can see that there are a succession of "OK" trades. "OK" means the trade was delayed. In fact they all seem to have been delayed by an hour (which you can't tell in this list because they have been resorted into time order. There is another report you can get which shows them in report order.).
So the bid/offer data shown is for an hour later and the trades mostly get wrongly classified as "buy" rather than "sell". It is clear they are sells if you look at the bid/offer data for the trades above and below them.
The trades tend to come in pairs which add up to about 50,000. It is clearly systematic and you will find them throughout the day. So it looks as though a broker was working slowly through a large sell order. Obviously there are others selling in response to what is happening too (as well as some buying no doubt.)
Personally I think its been caused by some profit taking which has then effected some auto stop losses. Once the dust settles, I'll be looking to buy more.
Looks like I managed to sell right at the bottom.. :) Well my stop kicked me out, but I would most probably sell it anyway as 10% move downwards looked like something serious. Hard to see any real support there still. Will probably wait until the daily chart turns upwards on some good volume before re-entering. Cheers for insight guys.
ive not been in the game long enough to know, but does a share do this when there has been such a surge in the share price previously? is it common to fall like this when people start selling and stop loss kicks people out.
Yes can do, momentum works both ways, just look at shares like £ASOS, and Trakm8 Holdings (LON:TRAK).
Director selling does not help.
Share can do that and usually does as none of them go up in a nice steady line of successive higher highs higher lows manner. Pullbacks are expected. Sometimes share overshoots well above it's "fair" price and that it returns to the more "normal" levels. The fundamentals of this one though did not look like the share should be overbought. 10% pullback on a day raised my attention, but could be what guys above mentioned and you yourself agreed with :) Sometimes when there are too many question marks it's better to move to another share and leave the troublesome one well behind. It might keep your mind occupied more than it deserves and better, cleaner opportunities will slip your attention.. Good luck.
Same seller (presumably - still using delayed reporting) was back today selling in 20,000 chunks whenever he could get 120p. A couple of times the price tried to rise and got quickly checked by another 20,000 sell. No RNS yet so it looks like he's still got a few more to get rid of.
When a stock has risen so swiftly as this one has over a relatively short period, there is always almost inevitably a pull back and although I am no chartist and my approach is very simplistic it is surprising how often a pull back in the order of 50% of the rise occurs.
In this case over the past 6 months the share price has risen from 60p to peak at 174p , a rise of 114p. Half of that has now just about been given back and that would cause me to look at the share with a view to a purchase. Fundamentals remain good and forward PE and PEG are reasonable. There is no debt and the dividend looks as though it will be well covered this year. Before investing I would need to examine the company's business model. This company does not operate in my favourite sector.
This is my personal rule of thumb and not based on any in depth study.
Hi Nick - looks like 4 late reported sales went through today with an aggregate of 75,910 shares taking the 2 day total from this particular seller(s) to 532,233. There were also a couple of non late reported trades for about 20,000 shares that also went through - if this was the same seller it takes the aggregate to up to 575,000. Last sale was at about 1.50pm so hopefully that particular seller is now done. If it was Patrick Harrison with his remaining 550,000 shares (no reason to think so other than coincidence in the volumes), then that would be the case.
Gus.
