"Picking turns," eh? The theory behind the classic Lane's Stochastic (plotting the percentage of a candle/window-of-time in which the asset trades at that candle's highest) is that as a slower (longer-period) moving average catches up with a faster (shorter-period) moving average, the market will be subject to change in buying/selling pressures. In particular, as the candle's trades group around >80%, the theory suggests buying fatigue follows, and as the trade's group <20%, selling fatigue will set in. (And when the Stochastic [of either length -- your choice] dips back below 80%, you sell, and when it climbs back above 20%, you buy.) Simple! But whither the volume?? We only have price and volume to work with, and leaving one behind is *foolishly* data inefficient. So! Enter the Money Flow Index -- basically a volume-weighted Stochastic -- including the same use triggers of 80% and 20%. https://en.wikipedia.org/wiki/Money_flow_index I plot both, and note divergences -- this has proven to be much more reliable than either one alone. And to reflect back on the OP, it's fun to play, "Caught ya!" when you see 2x or 3x regular volume pile into a trade, driving price in one direction, and then see 3x or 4x the volume follow along over a larger period, riding the change in the other direction. For example, they wanted to buy 20k of something at a bargain, so they sold 100k in a rush, dropped the price by a good couple of dollars, and then quietly bought 120k back in the ensuing "recovery." Could that be different traders/houses? Sure. And even if it was the same house, it could be going to different funds within, regardless. But it's still Manipulation-Via-Size.
I think the key, and I haven't done the research to know, is how many times you see 2x or 3x regular volume pile onto a trade to drive the price in one direction....and it either keeps going in that direction or stays there? Any insights, sounds like you've looked at this in a lot more detail?
I just looked at my ES graph (4hrs/1min), and there are no divergences to show you. BUT THE BASIC IDEA is that movement in volumes tempers the mercurial outcomes displayed by the Lanes' Stochastic. (Okay, they're not the most flagrant I've seen, but.... ) The Stochastic from 1400 to 14:30 would have you believe that the ES trend is ending a bunch of times, with all that time spent criss-crossing the Stochastic 80% line. But a glance at the MFI and the volume belie that-- the MFI spends most of that time below the 80% line, suggesting that climbs have not exhausted the volume (which itself is full of some good-sized blocks for that period). At 2:35, there's a good-sized selling block, which flattens the MFI, and then light volume, which weights the MFI downward. From 15:10 to 15:40, there again the Stochastic camps out above 80% and criss-crosses as before. But the MFI is much less enthusiastic (between 60%-80%), suggesting the trend has (volume-based) legs left yet. That last little divot (centered on 15:40) illustrates it: the Stochastic clears 80% again and fairly *yells* "Too high a price!!! The world is ending!!!" The MFI notes that big block of selling volume and sez, "No. We're still going. We're good." with a 50-ish read. (And now, we've finished another 5pts higher than that, so "MFI *wins!*" ) In general, "big volume" causes the MFI to moderate; light volume causes it to behave more like the Stochastic.
No, it's not possible. There is one way and one way only to make price go down, and that is to sell, conversely there is one way and one way only to make price go up, and that is to buy. You can't make price go down by buying. As has been pointed out, you can sell with the intent of driving down price in order to buy lower, but you can't move price by doing both at the same time. Legally of course. ; )
There is an obvious way and this is the gunning for stops scenario? Is that what you were referring to? Market makers do it all the time. Probably, daily if they can get away with it. Pretty much you know, consulting a chart where people place their stop losses and market makers having the huge capital can gun down those stop losses by bidding down prices. They do the same with options by widening the bid and ask spreads if you are an option buyer. If I do not get my order filled trying to buy in between the bid $2.00 and asked $2.80, say it now is bid down to $1.20 or even $1.00 then, I just cancel my order. I have to assume the market makers are up to their dirty tricks to snap up options at bargain basement, cheap prices. The next day, those same options will be priced sky high as the market maker sell it to you!
small's explanation makes the most sense so far. Ive wondered about this a lot but I by no means have the answers yet. When something doesnt fit, I feel theres a chance theres more to the story
Have been mulling over this, what appears to happen often in my observations, as soon as or shortly after mkt opens, a large selling bar will appear, this to start the day on a negative note. Longs will sit back perhaps apprehensive thinking if they enter they'll have it wrong. During the day the seller will keep hitting down any strength if reqd. The coupe de grace then comes EOD when the seller on close will give it another whack on highish intraday volume to ensure the it has left its mark where said stock is going. The open and close periods of the day are peak times to give the best impressions. Once downward momentum begins, it is easier to just keep pushing it along downward. Perhaps shorting is easier to manipulate than going long, as long only traders generally want to be on the correct side of the trend prior to entry.