The big thing to understand is that you don't necessarily need buying/selling to move a stock up/down. There are situations where *poof* all the sudden a new area of price is agreed upon by folks willing to buy and sell. This can be based on new information like earnings or just based on fair value calculations and movements in the overall market.
This happens every morning when stocks gap a little bit -- you can get an idea for how it works in the opening orders thread. Folks trading OPG take the closing price from the previous day and, based on how much the futures indicate the market will open up or down, come up with a guess on what the fair value of a stock will be. Once they have this guess, they put offers in x% above that price and bids in x% below that price. The idea is that they can occasionally get a very advantageous entry price selling above or buying below fair value.
This happens every morning when stocks gap a little bit -- you can get an idea for how it works in the opening orders thread. Folks trading OPG take the closing price from the previous day and, based on how much the futures indicate the market will open up or down, come up with a guess on what the fair value of a stock will be. Once they have this guess, they put offers in x% above that price and bids in x% below that price. The idea is that they can occasionally get a very advantageous entry price selling above or buying below fair value.
