Hi VictorpI notice on a couple of threads you have voiced...

Hi Victorp

I notice on a couple of threads you have voiced concerns about the trading depth and the lack of interest in MEO which leads to your questioning the reasons why you hold MEO. Of course these are questions you must answer yourself but if it is any help may I share my thoughts.

The longer I hold MEO and glance through posts in the MEO forum, the more I appreciate the strategies being used by people making money out of MEO. I have noticed this whilst trading in general over the years but, by being patiently waiting for the MEO announcement, have had the time to reflect on the market.

As we know, the XAO are influenced by a wide range of factors, be it positive or negative. The sentiment of the day runs through all stocks. The smaller the capital and the more effect it has.

In a general market down trend caused by neg outside news (eg DOW, oil prices, etc), as we have seen over the last week, the depth of the buy side of any share is reduced. Likewise if there is good news the buy side increases like today.

When this happens, on the one hand we ask ourselves about conspiracies etc on a downturn and on an upturn, for example, is there a leak. Unless a company has put out an announcement, there usually is no change in that company, no matter what any body says.

What we need to remember is that the bears or the bulls will always play on our emotions. They do this by either capping the sell side to create the impression that the stock is out of favour or stacking the buy side when they want it to rise.

In another thread, victorp, you said and price keeps going down with NO BUYERS in sight.

Not in the depth but there are people buying MEO shares 'at market' all the time. It is not in the bears interests, IMO, to show their hand by placing buys. If they did they would be less likely to trigger stops and the last thing they want to do is give the impression that the price is about to turn until they squeeze the last drop out of a downturn.

Converseley, with good news from the global front, the buy side gets bolstered and there is a sudden rise. The bears become bulls and sell into the rise. In the case of MEO anybody who bought at 32.5 to 33c over the last few days and sold today at 34.5 to 35c today made a profit of around 5%. This is perfectly acceptable to the short term trader and is all they are looking for. Once they have made their profit then the cycle starts again and the SP falls again.

Those that bought the shares in the rise become the anxious ones wondering whether to sell or not, put on stop losses which are triggered for the bears to buy again.

Losty hinted on this yesterday when he suggested a pump was imminent. Perhaps he bought yesterday and sold today. He has said before he doesn't mind if it is a 500 or 5000 profit, as long as it is a profit.

Sometimes the traders strike it lucky and the rise or fall is far greater but all they do is work on percentages. The fundamentals don't really matter to them and the worries of long term investors don't either. The more they can play on the SHs emotions the bigger the swings.

They have various tools for doing this. Apart from the dummy bids and caps, they have the bots, ASX releases and even stock forums to plant their seeds of doubt. Even the opening and closing auctions are places where traders can telegraph their intentions and tick traders can fool the average punter.

Another form of messaging is through charts. Because so many traders use charts then they their effect becomes the cause of swings.

An example is the fib ratio. This is a sequence of numbers/percentages that is derived from nature by a philosopher come mathematician. It is believed to be the building blocks of life snd is nature's attempt to realise the pure math's contained in the Golden Mean ratio. In charting shares it was noticed as a point at which a reaction appeared to occur. Now the fib ratio points are being used as a trigger point to set buy/sell orders. So from being a subjective vibration in the orderly way of nature fib ratios are used as an objective point for traders to collectively position themselves. I suppose any sequence of %ges could have been used but the fib ratios seem to work and have the mystique surrounding them.

In a downward trend, like MEO has experienced since the non-ann Sept, these fib points have been reached and bounced off creating another phenomena, the Elliot waves, which are another messaging tool. And so the TAs craft goes on. Because MEO is in limbo ATM this has meant a downturn to its present position. Like I have said before, the TAs don't mind the range a share is trading at, be it 75-80 or 32-35 as long as the percentage profit is there. To them the lower the price the better as less of a range is needed to realise that profit ie 5c from 30-35c is a 16% profit compared to a 6.5% profit between 75 and 80.

And to a TA their money is relatively safe with the impending announcement.

I am by no means bagging the TAs. To the contrary I have come to understand and admire their art a lot more since they have shared their charts and views in the MEO forum. Why I mention it here is to encourage MEOmites understand what is going on. I have come to realise that I need to learn more to understand their strategies.

Having said that I still believe the fundamentals should always be thoroughly researched before any short/long investment or trade, if only as a safety measure should delays occur like we presently have in MEO. Only this way can we switch off from the sharks circling around us.

This way we can take the some of the stress out of trading. I can't say don't worry - that is your prerogative. I am suggesting that we use the time we have to step back and understand ours, and others', trading strategies other that taking pot luck in a share hoping for the best and if it turns sour looking for someone to blame.

Maybe I am being a bit simplistic, but these are just my observations during this marathon wait.:>))