Low volume means little liquidity hence the wide spreads (which are fake anyway). Like I said, it completely depends on the market and who is actually trading. You might get all excited getting filled on the bid and seeing the offer 10-20 cents away until the specialist decides to take your shares and move the spread 20 cents down so now you & and some other traders are at the offer scrambling to get out. Liquidity pulls are a very effective trick of the specialist. I remember someone saying illiquidity equals volatility as a good thing. Yes, if there are real buyers & sellers. Otherwise it is a losing game to everyone except the specialist. Ever watch a high volume stock rip or plummet on volume? They move for points and are highly liquid. Best of both worlds.
I'm kidding.. Actually the only way I make money is trading the thin NYSE stocks. the key is just finding which thins have the real players.. that apect has become much more difficult especially in times of low market volume.
if one is to trade thin stocks - then one has to be prepared for the WIDE ranges - so, if the entry point takes into account the 30 - 50 - 70 cent (???) swing - and is prepared to wait for the swing back..... if one had a way of getting in at a "good"time - because they were so focused on how the specialist was trading the stock - ie i don't know if there is RIGHT answer - it is first a matter of risk tolerance and risk reward calc....imo