Wednesday, October 14, 2009

IMDS on Oct 13, 2009: watching the action

After seeing the IMDS action on the day before, Oct 12, I said in a private communication that I expected the stock to consolidate between 0.02 and 0.03 and then to perhaps make another jump a few days later. So far I am right, here is the IMDS chart up to and including Oct 13:

IMDS chart Oct 13, 2009

This type of pattern puts IMDS into the "stair-stepper" class. The intra-day (5 min) chart below shows what happened yesterday:
IMDS 5 min chart Oct 13

The first few minutes after the opening bell were fun to watch, with traders running in droves to sell the stock. I don't know how many people were taking profit and how many were trying to short the stock, but the price action was quite predictable. When the stock hit the 0.02 level (losing 1/3 off the previous day's close) my brain told me I should buy it -- but I did not trust this voice and did nothing on that day. About 10% of day's trading volume was made in the first five minutes. You can see volume dying off in the intra-day chart.

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