If you think about it the price is pushed up either by surplus of buyers (at market price) or alternatively a shortage of sellers. Shortage of sellers means a price increase at a lower volume, not higher.
Very good! This is something I had to learn to understand what I was seeing on the L2 display of my real-time quotes. Sometimes, when MMs are piling up on the BID side of a stock, it means there are lots of people wanting to buy and the price is about to go up. Other times, it means there are lots of people NOT willing to pay higher prices (so they accumulate on the bid), and the sellers will have to capitulate and the price will drop like a rock. I used to think it was all simplistic, but it isn't. You have to watch the total action: price, price change, volume, frequency of trades, trades at bid/ask, trades inbetween bid/ask with increasing or decreasing frequency, etc...
I haven't been able to place objective definitions on what I see yet, but I'm beginning to develop a 6th sense of the action and can take appropriate positions. As an aside, some of the most violent price changes I've seen popped right out of very low activity periods. Let's hope CREAF does this (to the upside)! |
