Spike in volume

[quantdropout]

I utilize briefing.com to follow the news of the day. On occasion, it is reported that a stock is experiencing a huge increase in volume (and it correspondingly goes up).

Generally (>90% of the time) it fades significantly from the high, and in many cases, it is actually back to price, pre-increase in volume by close of market of or a few days later.

Why wouldn't the individual/fund/etc. gradually build the position rather that running it up (sometimes a dollar plus)? I assume that he could have obtained his position at a less expensive average price if he had.

I appreciate any thoughts, comments, and perhaps ridicule if I am missing the obvious.

Clearly, I am going to fade every run up that is reported in the future until this no longer seems to happen, or I understand the risk more accurately. I am willing to share profits for constructive commentary

 

[murray t turtle]

Quote from quantdropout:

I utilize briefing.com to follow the news of the day. On occasion, it is reported that a stock is experiencing a huge increase in volume (and it correspondingly goes up).

Generally (>90% of the time) it fades significantly from the high, and in many cases, it is actually back to price, pre-increase in volume by close of market of or a few days later.

Why wouldn't the individual/fund/etc. gradually build the position rather that running it up (sometimes a dollar plus)? I assume that he could have obtained his position at a less expensive average price if he had.

I appreciate any thoughts, comments, and perhaps ridicule if I am missing the obvious.

Clearly, I am going to fade every run up that is reported in the future until this no longer seems to happen, or I understand the risk more accurately. I am willing to share profits for constructive commentary

=================

QuantDR;
Sounds fair enough,sharing profits for constructive comments;
mabe a good plan depending on if THE stock/THE sector.

Am not long or short this one now,THE= strong stock,strong sector;
@ end of day,investors.com noted ''THE volume change +213%''

Fading your source ,or CNBC maybe works much better than fading IBD website;
no doubt some were scaling in, long all year,
but at end of day on this one,
still up.


[THE=stock symbol, Quantdr]

 

[quantdropout]

thank you murray t.

i use ibd as well, what i meant was the spike in volume that briefing.com reports is usually confined to a 10 minute spike up. Thats what i don't understand. Why such a run-up on a non-news event?

 

[murray t turtle]

Quote from quantdropout:

thank you murray t.

i use ibd as well, what i meant was the spike in volume that briefing.com reports is usually confined to a 10 minute spike up. Thats what i don't understand. Why such a run-up on a non-news event?

============

QuantDR;

Sounds like the one to fade , only 10 minute spike;
some big buyers/sellers like to run it thru support/resistance.

A sideways trend tends to limit the move;
my least favorite. no follow thru for 30 /120 minute candles

And a strong sector would be suspect first for selling/bull trend;
and a weak sector would be first suspect for buying / bear trend.

 

[BlueHorseshoe]

Quote from quantdropout:

thank you murray t.

i use ibd as well, what i meant was the spike in volume that briefing.com reports is usually confined to a 10 minute spike up. Thats what i don't understand. Why such a run-up on a non-news event?

Some operators will spike a stock on purpose in order to generate attention ... try to attract some momo buyers, if you will.

Yes, they spike it so that briefing and the others will give it some quick press.

Typicaly the operator has a big position to unload and they are trying to generate some attention as lead up to their selling.

I've seen this on the Asian exchanges, don't follow US stocks so closely.

It is also touched on in "Reminiscences of a Stock Operator."

Then again, someone could have a fat finger, or jumping on false news, or just drunk ....

Could also be a rogue wave phenomenon ... i.e. they are bound to happen purely by chance, though I wouldn't ever bet on it.

 

[quantdropout]

Endwave spikes 1 pt over the past 8 min

Again it happens.............I know i'm nuts to want to understand WHY, but WTF???