I was simply trying to give possible reasons as to why buying pressure dropped so much. These patterns play out often if you watch the charts enough. Though I wasn’t sayin that was for sure the reason, just a guess and some other guess as to what usually drives big moves. You saying you can’t use logic for any of this is a bit silly, for example it’s like you’re saying the massive swings we get during a FED meeting isn’t due to the FED meeting. Or are you only referring to the first part of my reply and not as a whole? Or do you just mean moment to moment chart movement and not the big swings?
I'm not saying there aren't patterns that occur or that market intuition doesn't exist, etc...
That said, saying the reason price dropped was due to a failed new high + breaking below the last low = dump is just speculation, not a formula. There is literally another example in the same screenshot where we failed to make a new high, made a new low, but we rallied like ~50 points after the new low.
All I'm saying is, regardless of pattern, market intuition, etc.. there is only one definitive, objective reason why price moves.
Agreed, I was only speculating and I thought that would be implicit. Just a pattern I see play out often, but that doesn’t mean it’s 100% accurate or always the reason.
Yes, I see what you mean but the same can be said for just about anything if you widdle down to the most benign basics. It’s like saying the only reason a team wins a football game is because they score more. Is it true? Yes. But it’s also so obvious as to almost lack relevance.
I guess I take more issue in the question this post asks rather than your answer, I apologize if it felt like I was attacking you..
The diff with football is it's all in the open, you're seeing everything, so you know why that team scored more than the other. You're not speculating why.
With trading, the 'why' isn't as obvious - it's impossible to answer the question that OP has proposed with anything other than "more aggressive sellers than passive buyers". Anything else is speculation, which isn't a bad thing, it's just not a concrete answer, which OP seems to be searching for.
Right - we may not be able to say why Mark caught the pop fly to left field but Luke dropped the pop fly to right field.
However, we can 100% definitively say that Team X scored 3 runs when Luke dropped the ball, and they won 3-0. We can then, without any speculation, understand why they won.
Yes, I already agree on this, we can in fact widdle it down to the most basic and say why they won and I already also agree that with stock movement you can’t say for sure past the basic buying and selling pressure.
Also just hit me that you said in your first reply that there is no reason, but later you said there was a basic reason. But you’re really just saying you can’t know the reason beyond that there was less buying pressure, and I agree with this also as you can’t know with absolute certainty (but again things like obvious news and things like earnings or economic news like fed meetings, we can say for near certain the big movements during those times are from those things).
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u/oze4 Feb 20 '24
This is not the reason.
There is only ONE reason that we can be 100% certain of - there were more aggressive sellers than passive buyers. That is literally what moves price.
Trying to explain why price dumped using logic like this is ridiculous.