Posted by BALANCE_VIEW > 2021-01-12 09:29 | Report Abuse

absolutely Ben!. I am waiting for this day to arrive !!


-Whenever the short seller decides to close their short positions, the price will jump significantly - in particular in the cases of Top Glove and Kossan, where the net short positions on the total outstanding stock of the companies is 2.62% and 1.64% respectively.

Posted by wkc5657 > 2021-01-12 11:16 | Report Abuse

RSS volume a trickle now....

True that if short positions are closed, the price can jump. The reverse could also be true if these players want to hold on to their positions longer as there is still some distance towards the 4% limit....

Posted by Ben Tan > 2021-01-12 11:24 | Report Abuse

BALANCE_VIEW, wkc5657, thank you for your comments.

wkc5657, please note that at the peak of the attack last Monday, the short seller unleashed short sales equivalent to 1.52% of the entire outstanding stock of Top Glove. As of yesterday end of trade, the net short position on Top Glove is 2.73%. Thus, there is only 1.27% left until the limit of 4% is hit. In other words, unless the short seller unleashes all at once, in a last attempt to bring the price down, there would be no other possibility for a downtrend.

It appears that the short seller might have been unable to procure sufficient quantities of shares for short selling on Supermax, probably because the free float there is significantly smaller. If yesterday was any tell, it seems like the short seller may be going more aggressively now on Hartalega.

Posted by CJkenho > 2021-01-12 17:57 | Report Abuse

Ben, truly appreciate & grateful for your most generous write up in this & past few related sharing. It has been an eye opener for me & thus been trading more cautiously.

Just curious looking at how the glove prices have rocketed since last Mon, would it mean that for the short sellers to profit now, gloves prices would have to fall below last Mon's price? If yes then that's a pretty tall order I think. Case in point this morning after the news of the Emergency was announced, there was tremendous weakness in most counters & I believe the shorties should've / would've attacked aggressively. Yet i.e. gloves prices fell nicely on the 200ema lines & rebounded confidently. Harta's rebound was the strongest.

Moreover with the 1.27% left in TG's case, it's beginning to sound like the shorties had better start cutting their losses already?

Posted by limontea > 2021-01-12 22:00 | Report Abuse

Thank you, Ben, for the insightful sharing~!

Posted by Ben Tan > 2021-01-12 22:12 | Report Abuse

CJkenho and limontea, thank you for your comments.

CJkenho, it is hard to estimate how much is the average shorted price for the short seller at this point, but since most of the shorting was done in the morning last Monday, let's assume that specifically for TG, it is similar to the closing price as of 31 December 2020 - RM6.12

The short seller is paying fees to the lender of the shares, likely on a daily basis. The fee may be significant in value. Thus, it is conceivable that if the short seller does not close their position within this week, their break-even price might be around RM6. Obviously currently they are very much in the red. However, my suspicion is that there is a higher order game in place here, i.e. it is not simply a game where the short seller necessarily wants to profit only from the short trade itself.

Regarding why they didn't attack more aggressively, I believe that they might, at present, not have many shares left for shorting. They might be trying to procure more shares from lenders (such as EPF for instance), but we can't know unfortunately.

Posted by limontea > 2021-01-12 23:27 | Report Abuse

True, it's not as straight forward as we thought or as it seems to be. JP Morgan, BlackRock, EPF, IBs, Bursa, Media, Politicians, etc. Imagination can go wild.

We will just need to trade more cautiously I guess.

Posted by CJkenho > 2021-01-12 23:34 | Report Abuse

Yup yup true that. Can't fully use up their quota on just one battle tho it was a good fight. But wow the rebound up this morning was just so ready & strong. I believe the IBs were already informed last night & would've been on standby.

"However, my suspicion is that there is a higher order game in place here, i.e. it is not simply a game where the short seller necessarily wants to profit only from the short trade itself."

Totally spot on Ben! These players have one of the smartest & most experienced brains in the biz. It just can't be that 1 dimension in the fight. They would've orchestrated even that step where their positions are open to public knowledge for us to calculate & piece all these info together to figure out their game. Stay safe bro.