Yesterday, traders and active investors witnessed interesting positioning by a well known analyst and personality in the market place and social media. Traditionally, capital market participants were made aware of actions by specific analysts, research firms, and high profile investors about particular opinions or specific buy and sell motions that would influence in the short and long term. Modern day traders have to be mindful of the aforementioned influences in addition to certain social media and traditional media personalities.
On Thursday, we detected specific filings by high profile social media and biotech investor Martin Shkreli of KBIO, KaloBios Pharmaceuticals. The action resulted in extreme volatility and price action in the stock. Furthermore, we continued to detect addition insider purchases throughout the trading day. The action and the corresponding volatility confirmed several important points in the new dynamics of the equity markets.
Isolated social media based personalities continue to have an impact on sentiment and price action in securities. In cases such as the KBIO situation, we cannot overstate the importance of understanding the nuances and dynamics of certain posts on social media portals such as twitter.
Insider and company filings are closely followed by experienced market participants. Experienced traders and investors have repeatedly witnessed correlations between important filings and stock volatility.
The TradeXchange has been a leader in understanding the nuances in social media based information and the markets’ perception of numerous and sometimes overlooked insider actions.
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