Quote from Paddler:
Seems almost but not quite.
Think a little deeper on the process of how the minority gradually transforms as a majority and vice versa. One day, you may be able to trade with DOM and T&S alone without using a chart nor confronting any risk.
Big buyer comes in and has to buy alot of stock (100%) and drops it in possibly by market order (if it is limit he does so near current price.)
He is buying from few small guys each has a place in at every step of the limit ladder, lets say 10% of what buyer wants is at each step
buy buys 10 and pushes price up. then 10 more and 10 more at even a higher price.
buyer pushes price up 9 steps.
at each step he had unfilled fifo orders?
and now he is up 9 steps he still has 10% more to sell. but price is beyond his acceptable amount. so now he has orders waiting that no one is buying , orders slow down drasticlaly. What is left is retail orders trading on majorities side that are willing to higher then big buyer. but they are few and met with other side.
price becomes chopy tight and slow. flat and dojish.
price comes down a bit and buyer may buy more to try to move his last 10% or he may leave it for another time?
lets say buyers 10% are met by the retailers, or off the plate.
once it is gone all lower levels of the laddeer shoudl be empty in theory (not sure about unfilled oreders) as for above alot has been eaten up fast and there should be a lineare amount of orders at each level up. possibly even a big seller.
choppy trading slows and in comes uncertinty, price is not flying like it was. Some retails may panik and get out when they see a possible reversal. They signed up for a rocket and got flat. some revers
either way nothing is under price goes down, 1 min chart looks weak and 1 min players sell. this causes 5 min to look bearinsh and they join in the sell side. hourly traders soon see weekness and sell.
This is acceleration. (not a fact)
now intresting thing is that 1 min players play with little , (assuming) 5 min playter play with a bit more , hours players play with even more money.
fialure is first on 1 min then on 5 thnen 1 hrs
each time frame has more money involved. so as people join, we are not having linear growth in volume but rather increasing slope or exponential.
added to this is that we ate up lower ladders on on the way up ?
people who reverse, take away from one side and add to the other whit is X2 volume
This is not a fact, i am guessing, I guartee there is a few things wrong
we need to add in fifo lines/unfilled order ect.
we need to understand the idea of shorting.
The right place to be is to be in with majority before they get in and get out before they get out. this is imposible. bige buyer dumped in his orders system is flooded, you can only hope to get in
So instead you begin to sell to him once you feel he is almost done buying based on his # of unfilled order. or based on speed, or when he is done and masive volume becomes small selective nervous slow retail oreder volume. .
Sorry about the clarity