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Theories of Infinite/High Liquidity

Posted: Thu Nov 18, 2010 10:20 pm
by xtremeforex
Imagine a tub of water.

You take a glass and dip it into the tub to remove a glass full of water.

The volume/space you remove is immediately by filled by the remaining to occupy it.

In infinite liquidity, no matter how much water you remove it keeps filling up the empty space.

When you buy after a significant drop (somebody has sold), even in a 5 second time frame. If we assume that somebody has bought just before the drop, they were screwed over by the drop. You buy right after drop, essentially getting a sale on the price.

He's holding on but you have a better price. Who's price is more competitive for sale?

Who has the luxury to hold on longer?

Why wouldn't you hold on longer?

Who is in a better position to sell?

Think about it, lets discuss.