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What if just one minute later the screen looks like this Figure 11.4? |
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Figure 11.4
Snapshot of MSFT at 11:01 AM |
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Notice what has happened: |
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The bid has strengthened because there is increasing buy pressure. Five market makers have joined the best bid. Displayed size has increased by 8,600 shares. It seems that everyone suddenly wants to buy at 120 3/8! |
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The offer is moving up. Several market makers have increased their offer price and the shares offered at the best offer price have declined by 10,600. No one seems to want to sell at these prices! |
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If you are watching level II and you see pressure increasing on the bid side and shares disappearing on the offer side, don't you expect the price of that stock to rise? You are seeing demand in action, and prices should rise accordingly. |
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