Q Price discovery From Wikipedia, the free encyclopedia The price discovery process (also called price discovery mechanism) is the process of determining the price of an asset in the marketplace through the interactions of buyers and sellers.The futures and options market serve all important functions of Price Discovery.The individuals with better information and judgement participate in these markets to take advantage of such information. When some new information arrives, perhaps some good news about the economy, for instance, the actions of speculators quickly feed their information into the derivatives market causing changes in price of derivatives. These market are usually the first ones to react the transaction cost is much lower in these market than in the spot market. Therefore these markets indicate what is likely to happen and thus assist in better price discovery. https://en.wikipedia.org/wiki/Price_discovery Factors of sensitivity Recent changing in market regulations, post Lehman Bros, have outlined practices that affect the price discovery mechanism.[citation needed] Price discovery is sensitive to many factors. Consider for a specific execution venue the following inputs drive the price discovery mechanism. Number of buyers Number of sellers Number of items for sale in that trading period Number of recent sales or purchase price (this is the price as which items traded) Current bid price Current offer price Availability of funding Obligations of participants (e.g. regulation, exchange rules, Fund Policy) Cost of execution (market fees and tax) Cost, Availability and Transparency of pricing information in current and other execution venues. The cost of execution applies to all markets, even a street market trader may have to pay to have a stall, or invest time walking to a village market. These are not costs of production but a cost incurred to access the execution venue. Remember that price discovery is a summation of the total market's sentiment at a point in time: a multifaceted, aggregate view on the future. It is how every price in every market is determined. The market price is important as it is a factor in the pricing at off market execution venues and direct and indirect derived products. For example, the price of oil has a direct bearing on the cost of tomatoes in cold climates. UQ
OT; Some look on mountain charts,line charts.....candle charts; which includes much of your info, but in picture form.Thanks