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How can a Stock close at .50 and the very next morning open at .25??? I see I have so much to learn
Posts: 73 | From: Arkansas | Registered: Jan 2004
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I see no one has answered so i will try. It means that even though someone was willing to pay .50 the day before, the next morning people were only willing to pay .25. The price of a stock is the price someone is willing to pay and the price someone is willing to buy. If you take TA, fundamentals, PR's, rumors, and anything else you can think of, and combine them, you have the price of the stock. The price could have dropped for several reasons. 1. News was released that made it to where no one was willing to pay more than .25. 2. A thinly traded stock. MM's can really manipulate low volume stocks. What usually happens is they are short the stock, and someone has a stoploss posted to the market at .25, so if a MM can make a quick buy at .25, they made a quick .25. If there is no news then the price will raise because people see it as a chance to buy more, maybe average down. If its news, you may see a continuation of the selloff till it finds its balance. There are more reasons, but these are the most frequent. Just remember this can happen in reverse, and have a gap up. Ken Posts: 40 | From: Colorado | Registered: Dec 2003
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