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rjn7 wrote:
>
> Read an interesting piece in RT's tactics section about using the
> Ask-to-Bid volume ratio to predict short-term stock movement.
> Unfortunately, I still don't have a handle on the impact of Bid and Ask
> volume in general and how to read it. It must be important or it wouldn't
> be provided by the real-time quotes services that I have sampled.
> Can anyone help?
>
> bob nelson
Sometimes volume can be decidedly slanted toward one side of the market
or another. I've run across stocks which trade for weeks/months on the
offer with small client orders constantly chiping away and then every
once in awhile a big block goes up , then the cleints resume. I was the
specialist on a stock where this was the case for the longest time. No
institutional buyers most of the time - just sellers. All buyers(and
there were lots) were retail clients. The inst. players would sell on
the offer until they decided it was time to scale up to a higher price
and let the little guys pay more. This scenario made life easy for me
because every once in awhile I would clean out the offer and buy a
hundred thousand shares or so knowing that at worst I could just get out
on the offering if the bigger players came back at the same price and
slowly flatten out the position.
Basically bid/ask volume gives you an idea of who is more anxious to get
the trades done.
Rob:)
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