Trader’s Narrative

A while back, I mentioned I had an investment (not trading) position in Liquidation World. Since then, I’ve continued to hold the position and watched as price has meandered down from its swing high in April 2006. Here is a chart of LQW showing insider selling:

Source: Ink Research

One officer has sold more than $370,000 into the market within about two weeks. This is a tiny amount but given that this stock is a micro-cap and highly illiquid, it does have an effect.

Of course, I’d prefer to see insider buying but it doesn’t bother me to see this insider selling. This is because insider selling after a price increase is not that bearish. Insider selling after a price decrease, on the other hand, is very bearish.

In the meantime, I’m watching the technical levels on the weekly chart and will trade off of it - given no news or other extraordinary events.