The Market Maker's inventories
- Champion
- Feb 9, 2022
- 2 min read
There are various factors that contribute to the decline of the stock market, and insider selling and short selling are not the only ones. The Market Maker's inventories and the impact of public selling also play a crucial role in determining the extent of the decline from a rally high. Based on this, the Market Makers decide the course of action to unload their inventory.
It is important to understand that the stock market operates on its own internal logic and economic developments do not directly influence its movements. Rather, these developments are used to justify price changes or manipulate investor sentiment. However, the market can have a significant impact on economic conditions.
Short selling is often misunderstood as a strategy that benefits investors, but in reality, it is a profitable activity for Market Makers. The media tends to create the impression that high short interest is a positive sign for the market, suggesting that a sharp increase in stock prices will occur when short sales are covered. However, it is crucial to note that Market Makers engage in short selling when they intend to drive stock prices down. In fact, more than 85 percent of all short selling is done by Stock Exchange Market Makers and other members, indicating that a high short interest is a warning sign of an impending decline in the market.
It is clear that the movement of stock prices is not determined solely by economic laws, and the future trends of stock prices are influenced by the expectations and objectives of the Exchange establishment's elite clique. The Market Maker's price movements are based on their knowledge and awareness of future events, and they use this information to manipulate public supply and demand through price fluctuations. In essence, the Market Maker's vision of the future shapes the flexible blueprint for the market, which is reflected in stock charts that outline a stock's past history of highs, lows, and closes.
In conclusion, the stock market is a complex system that is shaped by a variety of factors, including insider selling, short selling, and public selling. It is important to recognize that the market operates on its own internal logic and is not directly influenced by economic conditions. Furthermore, a high short interest is not a positive sign for the market but is instead a warning sign of an impending decline.
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