Why does the stock fall even when there are more buyers in the stock market?

Friend,

If you follow me, then you will know the answer to this question better because in my post I had shared a very important thing related to volume analysis. Which generally no big channel in the market tells you.

Let us keep that aspect in brief in this answer as well.

Before reaching the answer, tell me one thing, how do you know that there are more buyers?

Maybe due to one of the following reasons.

1) Stock Info:

In which if we look at the last, then we find how many total positions are made on the buying side.

2) From Volume Indicator:

Whenever a big green candle is formed, we feel that there are more buyers.

Is it right???

Now if I tell you that a retail trader will do both these analyses 100% wrong?

You will say… does this also happen?

Yes, this is exactly what happens. Now I will tell you the mistakes in both the points along with the reasons.

1)Stock Info:

Have you ever noticed that when we open it in our demat, we only see 20 columns of buyers and sellers. Yes, but the total shown at the end is correct. It is made by adding all the columns visible and invisible to us.

Now the biggest problem while analyzing it is that we are not able to see how many bids have been placed on which price. We can only see the bids running on the 20 nearby prices.

For a better analysis, instead of the total, it is necessary to have data on how many bids have been placed on which price.

2)With the help of volume indicator:

Most of the people think that the green candles formed on the volume chart mean that there is more buying and on the other hand, they believe that there are more sellers due to the red candles formed.

Which is completely wrong. It is not necessary that there are only buyers in the big green volume candle formed on the chart. And the second biggest problem is that the volume indicator only follows the disclosed data instead of considering the actual position formed in the market.

If you are in the market then you can understand the difference between actual quantity and disclosed quantity.

Hope the post will be useful for you.

Thank you