gaps don't mean a thing

Quote from small_beer:

There are gaps and then there are gaps.
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I agree

All gaps are purposely engineered events – the reasons, although appearing varied, and possibly disassociated – are not

Some of these are meant to fill near term, others are not – but none occur happenstance


RN
 
Quote from Redneck:

I agree

All gaps are purposely engineered events – the reasons, although appearing varied, and possibly disassociated – are not

Some of these are meant to fill near term, others are not – but none occur happenstance


RN
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I've read that as well.
 
Quote from Zr1Trader:

Gaps represent a change in supply and demand.

Example...Why are people now paying 110 this morning for something that was 100 yesterday at the close?

There is more demand.

More willing buyers than sellers is what the gap means :)
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You know until recently I would have said the same thing. I watched a video last week that explained price moves based on liquidity in lieu of the traditional supply and demand reasoning. I liked it.
 
If a stock gaps up, say a buck, I surmise it would be easy to clump most unsophisticated traders on one side of the market, selling within its confines. The hole in this logic is sophisticated traders would be buying at a relatively high price unless the gap fails to close same day and price reverses. When a gap up results in a trend down day, perhaps they are using the opportunity to sell into an abundance of buy orders in the book pre market.
 
Quote from Lucrum:

You know until recently I would have said the same thing. I watched a video last week that explained price moves based on liquidity in lieu of the traditional supply and demand reasoning. I liked it.
More...

I've heard price follows order volume but I wasn't able to take anything from it looking at the DOM.

Link to vid?
 
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