After our earlier article went out on Monday, we were shocked at the thousands of visitors to our website within the first hour.
What a disastrous week it has been for the shareholders and for the people taking shorts, it has been a great week.
The quick rise and fall of SX, can be a lesson to speculative investors – sometimes a very costly lesson:
- Always take some profits off the table
- Only play with money you can afford to lose
- It’s not profit unless it is sitting in cash in your hand
Right after posting our article earlier this week, it was apparent by the number of notifications we got instantaneously that something was up.
It had gotten out of control, almost like a herd mentality with lots of likes and re-tweet etc and blowing up the message boards.
Twitter “personas” were always pumping the stock but now it had started to get turned up a bit and they were getting cocky and making outlandish and far reaching assumptions such as:
- Share price at the end of the week will be $5 – $10
- A $100 stock by end of year
- They are going to Silicon Valley, must be a Google buyout imminent
- Chinese company Alibaba is acquiring them
- This is a Multi billion dollar company, the new Google
The list goes on and on. A little bit of advice if it seems too good to be true it probably is.
The SX “Long and Strong” were keeping this momentum long into the downward spiral. Cognitive dissonance set in and they kept telling themselves what they wanted to hear.
Once you lose the momentum and the people bullish on the stock are telling you one thing while doing something different (i.e selling) you are in trouble and it is hard to keep the ship afloat.
Some conflicting views of what happened:
- Elaborate Pump & Dump orchestrated by SX’s IR firm, or an independent party
- An organized Bear Raid by Institutional Investors to shake out the small retail investors, so they can acquire a large stake in the company cheaper
- Short attack turning growing stronger as momentum picked up
- High Frequency algorithm trading which drove the share price down
- Etc, etc, etc.
In the end, the quicker they rise the harder they fall, the price over the last 2 weeks rose up from ~$0.30 up to $2.90. Then came crashing back down in 3 days back down to $0.30, with over 91 Million Shares exchanging hands in 3 days. With one more trading day left this week, it is anyone’s guess where it goes now.
Here is what we can confirm:
- they have an non-binding LOI with a Chinese company Qingdao Tiande Technologies for all of their Blockchain and smart contract technologies assets
- Their website is www.tdchain.cn (you can view with google translate if interested)
- They need to close their financing for $150M in their subsidiary
With the recent share price downturn and investor pessimism, this puts risk into the possibility of this deal closing. If they do close, this could potentially be a big win for the company, if not watch this get beat up even more.
But then again you never know with speculative plays like this only time will tell.
Fortune Favours the Bold
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