The buy: sell ratio has dropped from above 3:1 to now 2:1. You...

The buy: sell ratio has dropped from above 3:1 to now 2:1. You might think this means some short covering has been happening, but it looks more likely to me that many of the transactions are not from the buy and sell queues. With ASX anything is possible.

It also may be that the shorters are selling both from and to related companies. This can walk the share price down but with the shares still being held by the organisation concerned. The cost of dropping the share price in this way is minimal.

Also, every time the shares move from one party to the other (or back) they can be declared as a short sale by the selling party and the buying party can lend them out again. This can increase the number of reported short sales and the number of accumulated shares eventually used for repayment of borrowings. Theoretically the number of short sales could exceed the number of shares on issue but that wouldn’t happen in practice.

There is so little transparency that almost anything could be happening except fairness to retail shareholders and traders. This “joke” is run by organisations who have their computers installed at the ASX itself so their buying side can know to the millisecond when a sale is being made by their associates and can snap it up.