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Old 08-16-2008, 07:26 PM
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Default How does price spikes work in stock market?

I know sometimes they're caused by news but I assume that news-related ones only happen at :00, :15, :30, or :45 minutes.

So when price is just going along being normal and then at some weird time like 14:02 it jumps up in a giant bar, what causes that?

Especially if you're using tick or volume bars and like 5 of them appear in 2 seconds when before the normal rate was one bar every minute or so.

I'm looking for a good answer, not "increased demand" or "lots of buyers."

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Old 08-16-2008, 10:39 PM
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The answer is a huge spike in volume, plain and simple. Either a large buyer/group of buyers or larger seller/group of sellers. The only things that moves prices are supply, demand, and specialists/MM.

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Old 08-19-2008, 11:43 AM
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I'm looking at my chart and there are sometimes big volume spikes accompanying normal-sized bars and sometimes big volume spikes accompanying large bars.

Much to the dismay of everyone on ET I have never seen a correlation between volume and price action. But that's an entirely different thread altogether Basically sometimes there is huge volume at the beginning, or middle, or end of trends, and sometimes not at all. One day I'll start a thread called "teach me volume" with a ton of screenshots.

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Old 08-19-2008, 01:10 PM
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A lot of traders can get "fixated" on one particular price all at the same time and then end up wanting to all do the same thing at the same time on the same side of the market.

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