Co-Diagnostics Down 86% On $3.50 Worth Of Trades – Market Manipulation?

Co-Diagnostics (NASDAQ: CODX) stock is down 86.6% premarket on what looks suspiciously like a piece of market manipulation. Assuming that it’s not just some kids having some fun, or a fat finger mistake that is. For there’s absolutely no news to back up such a change in the CODX stock price, nothing out there at all. Also, the last trades at the end of yesterday’s session show no price movements anything like that. But at the opening of the premarket there were two trades of an entire $3.50 or so in total value – that’s all that it takes to drop the reported ticker by that 86%.

As to what our reaction should be well, try buying at this price. It’s not – for of course it’s not – an absolute certainty that there isn’t some gremlin in the system that we’ve not been told about as yet. But the bet would be, from my point of view, that this is someone playing with the reported price. As a result of that we’d expect, as the markets open and liquidity returns, the price to move back to somewhere close to last night’s close.

The problem with this as a plan is that while it might be entirely possible to sell as much CODX stock as we like at this price of $0.39, it’s going to be extraordinarily difficult to buy any at that price. Market makers might be willing to buy at below market but the idea that they’ll sell, in any volume, below it requires a certain amount of faith.

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As we can see, there has been one recent collapse in the Co-Diagnostics stock price. So we might be primed to think that it can happen again. And yet look at this:

And then this:

OK, thinly traded stock and all of that. But if there were some disaster that gutted the CODX stock price then we’d not see total trade of perhaps $3.50 in value at this new $0.39 cents price. We’d see a flood of selling as a result of the disaster. So, the correct conclusion to draw here is that something like the postmarket price of $2 and change is correct, the $0.39 being the anomaly.

So, what do we think this is? It could, of course, be a fat finger mistake. Or some kids having fun – be a bit of a thing to brag about, moving a global price for $3. Or, possibly, someone out there has a derivatives position in CODX stock and they think they can close it out at a hugely manipulated price. My suspicion would be toward the third there, but I of course have no proof of it in this slightest – it’s a suspicion.

What should we do about it? Well, if it’s at all possible buy Co-Diagnostics at 39 cents and wait for the price to revert as the markets open and liquidity returns. But quite apart from the risk there – maybe there really is some news – I think the number of people willing to sell at 39 cents is going to be terribly small, likely to be no more than whoever it was who sold 9 pieces of stock earlier this morning.