Tuesday, August 10, 2010

The Unseen Hand

I think the market itself is an honest game. There are just too many marbles being pushed around to allow even the big boys to put their faces on the ebb and flow for very long.

That doesn't mean they don't try. Thousands do, I'm sure. But I'm even surer that there are thousands more who suspect and believe that miscreants are not only trying, but succeeding in manipulating markets constantly to the detriment of us, the small and meek. It happens all the time, they say. They can see it in their charts. A practice so vile that it is referred to only by its initials: MM.

Now, I'm an unbeliever in these matters, but now and then I sense a pattern in the movement of a stock I own that suggests the action of an unseen hand, be it Yahweh, or some hedge fund in New Jersey, I'm not sure. I had that feeling, last week, with ATPG, the thinly traded oil stock I own.

ATPG, a Gulf driller, has had its problems of late and, at the end of July, the stock was foundering in the neighborhood of $10.50. Then, it started off August with an unsuspected gap up to $11 at the open, followed by a gradual drift up in the direction of $12. That was August 2 and it closed around $11.50. On Tuesday, it began a steady rise to $12.31, then settled back to just under $12 at the close. I watched these events with increasing interest. Clearly, the stock was breaking out, but at whose behest, god or devil, I couldn't say. On the fourth, it opened up a dollar, near $13, and continued inexorably to the middle of fourteen.

Then, as the faithful were rejoicing, the stock began to swoon with as much purpose as it had shown on the ride up. The gas went out of the ATPG balloon, ending two days later with a big raspberries, on the floor of $10.46, a dime lower than its price at the month's beginning.

Everyone on the ATPG Message Board began to scream "MM" to each other and themselves. These abused innocents, suckered in once again, can be likened, in their belief, to the astrologers of old who beheld divinities in the heavens. They saw them in their charts.

But I remain skeptical, convinced as I am that only one force has both ability and desire to pull a trick like that. I sense the hand of Yahweh. I hear divine laughter. It's his MO.

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