To: 5,17,37,5,101,... who wrote (274 ) 2/15/1999 12:12:00 PM From: StockMiser Read Replies (2) | Respond to
MM's can stall and stop upward momentum at any time, unless there is major buying pressure from elsewhere, and even then can still manipulate price because of the number of shares they control. They merely drop the ask with a small number of shares, which spooks short-term and daytraders into selling below MM's ask or at the bid. This process creates downward momentum, and the MM moves to the now lower BID and picks up shares cheap. This happens about 1000 times every day with many many stocks. MM's also don't have to report accurate lot sizes...I see 100 volume bids by MM's all the time pick up 10-20-30,000 shares over time. The reverse is true when MM's want to dump shares...they create "artificial" upward momentum and sell into the momentum traders. Unless you watch the action of an MM on a particular stock, its very difficult to determine if they have a client that wants to buy or sell.
