SEK - Seek Limited

[vishalt]

Yeah I bought into it today after the breakout.

The jobless rate is tipped to fall below 4%, and that means Seek will be in a prime position to extract cash from it.

 

[reece55]

Man, this thing just keeps getting better - hope everyone is having fun on this ride.......

8.26 close, we have now traveled 90 cents since the move up (8 trading days), so above a 10% return so far. This was extremely good given the negative lead from Wall Street.

Check out ASX.G's blog - this is a prime example of when you should not short a stock. My question is what is expensive on a P/E basis if the goal posts are moved constantly - hence why T/A is my preferred method of analysis.

Cheers

 

[CanOz]

Is this tightly held or what? I just can't get over the price action relative to the volume.

Whats this saying about the supply available vs the demand now? To me its only a small amount of demand and bugger all supply!

Cheers,

 

[nizar]

I topped up this morning (doubled my position) after yesterdays breakout above the range.
Its like dejavu. See AED when it broke $5.25 after a 4-month consolidation and look what happened to that.

 

[reece55]

Is this tightly held or what? I just can't get over the price action relative to the volume.

Whats this saying about the supply available vs the demand now? To me its only a small amount of demand and bugger all supply!

Cheers,

Hi Can
That's exactly why the short position was so disastrous..... The thing is so tightly held that when the shorts set a stop position to close out, due to the lack of sellers, they are just stuck accepting whatever price is on offer..... Like I say, even if they bought every security traded today and yesterday, they still have about 9 days left to cover..... This is why I review the short positions relative to average daily volume - shorting an illiquid stock where there is no identifiable downtrend is financial suicide.

I will check with the ASX to see whether we have anymore updated figures and add them on the blog.

Cheers

 

[CanOz]

Hi Can
That's exactly why the short position was so disastrous..... The thing is so tightly held that when the shorts set a stop position to close out, due to the lack of sellers, they are just stuck accepting whatever price is on offer..... Like I say, even if they bought every security traded today and yesterday, they still have about 9 days left to cover..... This is why I review the short positions relative to average daily volume - shorting an illiquid stock where there is no identifiable downtrend is financial suicide.

I will check with the ASX to see whether we have anymore updated figures and add them on the blog.

Cheers

Yes i can really see your point now, so are you saying this explains the loww volume and the increase totally? Is this all shorts covering?



Who on earth would do such a thing?

And this is what they call the 'short' squeeze?

Cheers,

 

[reece55]

Yes i can really see your point now, so are you saying this explains the loww volume and the increase totally? Is this all shorts covering?



Who on earth would do such a thing?

And this is what they call the 'short' squeeze?

Cheers,

Exactly Can, this is a textbook example of a short squeeze.....

Trading shares is about supply and demand for a stock. If you exposure yourself by taking a large short position in an illiquid stock where the holders are content to just hold on to their stock (SEK has several substantial holders), then you are bound to get taken out.....

These opportunities don't come along too often, so it's great to be able to take it when you can...

Cheers

 

[theasxgorilla]

Is this tightly held or what? I just can't get over the price action relative to the volume.

Whats this saying about the supply available vs the demand now? To me its only a small amount of demand and bugger all supply!

Cheers,

I think it is something along those lines CA.

And, in light of the short-squeeze insight from Reece, its not just the smart money buying, but also perhaps the dumb money covering shorts at whatever they can get!

Up through $8...and now blue sky. Nice trade so far gents.

 

[CanOz]

Exactly Can, this is a textbook example of a short squeeze.....

Trading shares is about supply and demand for a stock. If you exposure yourself by taking a large short position in an illiquid stock where the holders are content to just hold on to their stock (SEK has several substantial holders), then you are bound to get taken out.....

These opportunities don't come along too often, so it's great to be able to take it when you can...

Cheers

Thanks Reese, i'm awstruck by this! To learn something new everyday is a great thing, but to learn something new and be on the right side of the experience is even better. I would have hated to learn this while being one of the ones short...

I've saved the chart and shown one of the guys at work, this is really interesting.

I guess the other that comes to mind is the exit here....you say they've got another what..8 days left to cover?

Cheers,

 

[Nick Radge]

Still showing weak closes. Moving up, yes. But still needs caution until the weak closes have been dismissed. Remember that a stock can still be distributed as prices rise.

 

[CanOz]

Still showing weak closes. Moving up, yes. But still needs caution until the weak closes have been dismissed. Remember that a stock can still be distributed as prices rise.

Any comments on the short squeeze theory Nick, your experiences with them etc.? How should we play out the exit, move up the stop, keep the finger on the trigger?

Cheers,

 

[barney]

Still showing weak closes. Moving up, yes. But still needs caution until the weak closes have been dismissed. Remember that a stock can still be distributed as prices rise.

Hi Nick,

I may be a little out of my league here, but I looked at SEK and thought "I'm not game"!! ............... For what its worth, and for anyone interested, the outstanding short sale positions on SEK as at 9th July were 9,072,972 (3.19% of total shorts available) ........... The outstanding shorts as of today 11th July is 9,168,996 ( 3.22%) .............. So working on those facts ............... ALL the shorts (plus a few more) are still ON SEK. ie No one has closed their short positions yet!!! ................ (Or ........ they closed the initial positions, and then shorted some more??)

Nick may be able to shed a bit more light on the significance of that, but I would suggest that the shorts might have DEEP pockets, and if or when it goes, it might go big time?? ............... Any thoughts/comments? Cheers.

 

[reece55]

Hi Nick,

I may be a little out of my league here, but I looked at SEK and thought "I'm not game"!! ............... For what its worth, and for anyone interested, the outstanding short sale positions on SEK as at 9th July were 9,072,972 (3.19% of total shorts available) ........... The outstanding shorts as of today 11th July is 9,168,996 ( 3.22%) .............. So working on those facts ............... ALL the shorts (plus a few more) are still ON SEK. ie No one has closed their short positions yet!!! ................

Nick may be able to shed a bit more light on the significance of that, but I would suggest that the shorts might have DEEP pockets, and if or when it goes, it might go big time?? ............... Any thoughts/comments? Cheers.

Hrmmm..... big pockets, or very stupid financial thinking........

Can, personally my initial target of 8.00 was met quite quickly, so I have closed half and I will now be using a trailing stop. At the moment that trailing stop has now been raised to the $8.00 level. Tight yes, but I don't want to see my profits go out the door, and if I am right about the price action, then it will come.

Nick, agreed, it's choppy - but review the actual price data as opposed to the chart - very few were traded in that upper price bracket, the VWAP is steadily climbing. Personally, I expect to see high candle tails when the shorts attempt to cover..... Why, because physiologically they will take any price when they are being burnt.....

Just my opinion though.

Cheers
Reece

 

[j4mesa]

sorry, i was abit lost with the conversation.

DO you guys mean some people are shorting this share in a large position ?

On the technical indication, they are breakouts already and why shorting it ? although the P/E ratio is already high........

Please forgive my stupid questions if you guys reckon so........

 

[Dutchy3]

Generally I'm not one for indicators however ...

OBV might be consulted with SEK ... This indicator keeps a running tab of + and - volume depending if a white or black period is recorded ...

For those calling a top I see that all the while SEK spent accumulating (yes ... not distributing) from March - June 2007 the OBV crept up ...

Simply there was more average volume on the white days verses the blacks ... especially important as the blacks certainly outnumbered the blacks during this period.

As an aside .... if this ever was a short would it not have broken down after THREE MONTH's of effectively sideways trading, rather than broken up?, on a relative volume increase?

 

[barney]

Hrmmm..... big pockets, or very stupid financial thinking........

Can, personally my initial target of 8.00 was met quite quickly, so I have closed half and I will now be using a trailing stop. At the moment that trailing stop has now been raised to the $8.00 level. Tight yes, but I don't want to see my profits go out the door, and if I am right about the price action, then it will come.

Nick, agreed, it's choppy - but review the actual price data as opposed to the chart - very few were traded in that upper price bracket, the VWAP is steadily climbing. Personally, I expect to see high candle tails when the shorts attempt to cover..... Why, because physiologically they will take any price when they are being burnt.....

Just my opinion though.

Cheers
Reece

Howdy Reece, I agree on face value it appears financial suicide to keep shorting "up the line" .............. I'm just trying to fathom an answer as to why they would still be short ............... Possible scenario ??? ........ A major shareholder/s intends to dump a squillion shares on the market at some time in the future .............. Because they have two or three squillion shares to play with, they are happy to let the market run up (they even help buy it up ......... false security for buyers), so that when they finally decide to dump the "bulk" of the shares, they are doing it when upward momentum is at its greatest .............. Just a theory, but the fact remains that the short positions are still in place ................ Maybe I'm just a suspicious kind a guy, but i'm sure the big instos don't always play fair !................ Any thoughts? ...................

Nick may have some better insights for us if available

PS Just re-read my own post and not sure if it makes any sense, but its posted now so too bad ............. The outstanding shorts have got me curious though ................. Ideas anyone?

 

[reece55]

Look at who the substantial shareholders are Barney - MBL and Barclays......

Do you think they would have their $$$ on the table if they thought it wasn't going to do well.....

I'm not focussed on why there is a large short position, only that there is one and I can exploit it.

So far it has paid off handsomely.

Cheers Dutchy for the insight, I think at one stage they (the shorts) tried to sell it down below support, cause that's when about 2% entered. But support held strongly and they have been regretting it ever since......

Cheers everyone, great discussion.....

 

[CanOz]

Look at who the substantial shareholders are Barney - MBL and Barclays......

Do you think they would have their $$$ on the table if they thought it wasn't going to do well.....

....

Could these guys be hedging thier longs in SEK?

That would make sense, borrow a bunch to go short, ride out a temporary dip and make some money on the side

Cheers,

 

[barney]

Agreed Reece, You have bought up an interesting line of discussion here ....... and given a different slant of how to approach a trading position .......... It's certainly given me some food for thought ...........

CAN, I agree that hedging could be feasable ................. Approx 85% of the share is owned by top 20 s/holders, so the main way they can get capital appreciation on their holdings is to "beat each other to the punch" ............ I guess with the hedging/short idea, what we should remember is that even though they may be holding a 9 million share short position, what is stopping them trading in and out of that short position as the share increases in sp ?

ie. Sell at the high of the day, buy at the low, and all the while maintaining the same short position, only in a "better" position each day ............ That way, in the event of a market dip, they are in a position to take advantage better than we average punters ................ No idea really, just throwing some thoughts in the ring ......... Cheers.

 

[reece55]

Gents
I have taken my last stake off the table today at 8.30...

Price query with no response will most likely hold the market back for a while, content to take my 9% return in two weeks....

Cheers
Reece