We have noticed that quite often when the number of shares bought exceeds the number of shares sold the share price sometimes goes down ( and in some cases by quite an amount eg African Eagle AFE today..11/2) Yet some share prices increase when there are more sells than buys eg African Diamond AFD, African Gold AFG today etc. Can someone please explain why this is, as the number or buys and sells has in the past been key to our trading strategy. Is the information on Ample or Money AM concerning trades not accurate or are we missing something. Any answers / explanations would be really welcome.

Could it be that just the share price went up because the company was making better profits?

There is no relevance to buys & sells to share price. (As for someone to sell a share, someone else has to buy it!) Because everything is now computerised, all deals have to be matched. (I've managed to buy shares from my broker at a price I would expect to sell in the past, simply because he has been able to match someone elses sale, against my buy and I got the better price. Because the price was nearer the sell than buy price, it got recorded as a sell.)


If you go through the thread: ASK a trading question! I'm sure you will find explanations & answers to help you.

AFE - Next stop 30p, Vol up Fri to 730k ave 185k, worth watching next week - imho..
The 250k @ 24 trade on the bell can anyone confirm buy/sell? (shown as a sell on mam)

Hi Goldfinger...you and I were pretty hot on this one but we have seen a 35% drop in past few weeks and last few days particularly bad....ok I know someone sold a million last Friday, and AFE have been held up by the weather, but do you have any views on this at present....rgds

Hi Buckets. We have the same problem here. We think the fundamentals of this company are fine and we understand that there will be little news until work begins again in earnest after the wet season ie in May. In the hopes of good news we have held on to this share even though it has fallen through what would have been our stop loss. Is the price falling because there is no news or are the MM making money by buying at a low price now in anticipation of selling at a much higher price when hopefully godd news comes through?

B2B

There seems to be no apparent reason for fall today execpt for fall in price of
gold. Have checked website no news on it unless someone selling to make a profit

Small tick up lately but still low volume. AFE need to issue some news shortly otherwise the price will lanquish in the summer doldrums.

Re the initial question in thread title - don't forget that - as well as some of the biggest trades being legitimately delayed for hours (or days in some cases), several brokers (Etrade, NatWest, TDW among them) are processing UK trades on exchanges other than the LSE - such as Virt-X - and those trades are not picked up in most data feeds.

Personally I would never put much faith in trade listings anyway, and wouldn't take end-of-day volume totals on trust except as a crude indication that the number must be at least that size or bigger.

Supply/demand means shares generally must rise when more buys.However,there are
a trivial number of exceptions - technical,etc.

brain2brain - you are correct, the buys and sells are often inaccurate, read the disclaimer on the trades pages. All you have to worry about is whether the price is going up or down. You need level 2 information (which costs) if you want accurate info.

Abbie - if there's more buys then sells who have the buyers bought from?

Sellers

And who have the sellers sold to?

i think buys and sells are done through the mm's (someone put me right if i am wrong) so it depends on how many the mm's buy or sell. So they could buy a million and only sell 1000. Therefore demand is low from investors/traders so the price goes down and vice versa.

But if they've bought a million, surely they'd be dropping the price all the way through?

The original question relates to building a strategy based on buys and sells. ie using the buy/sell analysis to predict price movements. My point is that the price at any time already reflects any imbalance - and so I question the relevance of the analysis as a predictive tool.

brain2brain also points out that sometimes the price moves in the opposite direction to that expected by analysing trades - so in a way the questioner is drawing the same conclusion - there is no correlation. The only things that matter are the price and volume - the individual trades are a red herring. The price at which the latest trade was executed is the best guide we have to the value of the share. And the volume shows us how 'committed' the market is to that price.

He also asks whether the information on ample and moneyam is not accurate - I believe that all LSE reported trades are fed through to both of these sites, and each reports them accurately, after making a stab as to whether the trade is a 'buy' or a 'sell'. So long as punters want this analysis, these sites are bound to carry on supplying them.

Gausie

There were only two trades this a.m. of 48 & 55. What's going on? Is someone taking the p*~# ?

Generally speaking more buyers than sellers must equal price rise i.e.the
economic law of supply/demand.

Thank u abbie.

Concise, precise, and utter twaddle.

If there is more folk wanting to buy than sell, then the price will
go up to attract sellers until it reaches a new equilibrium.

If there is more folk wanting to sell than buy, then the price will
go down to attract buyers until it reaches a new equilibrium.

The higher the volume, the higher the demand and the more powerfull
will be the move.

This is what other posters in this thread are also saying, IMHO.

But the 'Buy and Sell' columns have absolutely nothing to do
with any of this. All they do is record a transaction between a Buyer
and a Seller and are as about much use as a chocolate fireguard.

Melnibone.

I like the idea of a chocolate fireguard!!

Mmmmmmmmmmmm.

:-)))

Gausie - twaddle ?
Are you suggesting the economic law of supply/demand is twaddle ?

I bit of illumination, if I may so venture.

Do remember that the buy/sell indication on a trade is a decent guess made by a little algorithm in MoneyAM's software. If it's too close to call, it gets put into the ? don't know category.

The reason for this is simple: the data feed from the exchange doesn't say if the trade is a buy or sell (and clearly, it is both, it depends where you're sitting). Think of a Market Maker to Market Maker trade: how do you classify that, as it doesn't include you (the punter).

It's just like the share price: it depends whether you're buying or selling.

B2b,
AFE is big blue today !

Thanks Safiande.

Its been a long wait. Lets hope it continues

B2B

This was mentioned in t1ps.
On Wednesday, www.t1ps.com revealed that Chaco Resources, the cash shell that used to be known as Goldmines of Sardinia, may have a second deal in the pipeline after a reversal of Paraguayan oil exploration acreage into the group. Market whispers suggest that the second deal is in Libya. After we broke the news to a wider audience here on UK-Analyst, the shares are rose 0.35p to 2.17p. Thursday's scoop from the UK's top financial website was that African Eagle is likely to be announcing some cracking drilling results from its Eagle Eye copper deposit in Zambia as early as next week. African Eagle shares jumped 1p to 15.25p on the revelation. For more hot tips like these click here.

It really is beyond belief at times, the mismatch between buys, sells and share price movements. I understand from all the posts I have read here that much of the formentioned have to be taken with a pinch of salt. But how do you reconcile this mornings figures with AFE. There have been over 250 000 buys and one sell of about 10 000. What has the share price done? Absolutely nothing. Unbelievable.
Any observations would be welcome. In the meantime I am going for a lie down.

B2B

Not sure if MM's are holding price back to let favoured clients pick up stock, or a sell being worked through.

B2B

The above is one possible explanation from another BB. Also I believe that the 100k+ buy this a.m. was executed on Friday p.m. Nevertheless there is little logic to it.

As an indicator Market Makers do carry positions, not necessarily to take a position themselves but it could be simply a surplus or deficit due to that days/ weeks trading.

So today there have been more buys than sells so why has the stock not gone up, it may simply be because the market makers have:

a) surplus stock carried over from last week
b) a seller in the wings who wants to move size through the market and has informed the market
c) covering a hedge taken out ( i.e. spread bet or CFD position)
d) or none of the above and they simply are not bothered about trades totalling no more than 50,000 on a stock with market cap of 5m+!

Hope this helps


Mike

Many thanks Mike.

The figures stand at 600 000 buys and 17 000 sells at present ................ and yes you've guessed, no chnage in share price.

B2B

PS what is the NMS on a share like this?

NMS is 5000 shares

Mike

Some very strange trades on AFE today within the total trade of almost 2 million shares so far today & the mid price is down by 7%.

I cant work it out either Just look at EEN 338.581 Buy's 181.560 sell's and the price jumped 17p and i think it done the same yesterday. How do people know when to buy shares like this. No announcements nothing. Anyone sho can tell me it would be appreciated Thanks

Real roller coaster today after the early RNS

AFE Webcast on T1ps today might be revealing

Please pass on anything useful on this. cheers MP

Moneyplus,
Here are some extracts from the webcast:

At Eagle Eye .. the strike length could be significantly longer than 28km. It was suggested 40km might be possible, and an application has been made for a licence crossing the border into Mozambique.

Tanzania where a new project called Igubrubi is being drilled in the next few weeks. An analyst working for AFE's broker visited this site a few weeks ago, picked up a rock and saw gold in it.

AFE has been approached by 4 mining majors about farming in to its potentially world class Eagle Eye copper project in Zambia. Apparently all four have now been shown data under strict confidentiality agreements.

Regards

http://www.uk-wire.com/cgi-bin/articles/200411090700140016F.html

Thanks very much Saf. I hope this will start to move the SP nicely up!

Large buy this a.m at the outer limit of the spread ( see below ) could infer that news is imminent?

102K772304 14.5 08:04 151137 13.5 14.5

About time!

Moneyplus,
Extract from the Web Cast :

***Mark Parker: Well, in fact, we now believe that the goldmine is part of the whole mineralised system which includes the copper system, so copper, gold - it's all one iron oxide copper/gold type deposit type system. Through this year, the harder we've looked at this project, the bigger it's got. We now have a strike length of some 29km from the east to the west of volcanic rocks which are mineralised with copper, copper/gold, copper/gold/silver and combinations thereof right along the whole length of it. Now, obviously not all of that strike length is economic and our task now is to find those currents in the bun which are going to make the project pay.
....
Tom: The fact that it is such a large project - and you mentioned a 29km strike length but it is conceivable, of course, that it could be significantly longer than that, isn't it?
Mark: Yes. The volcanic rocks of a particular age (about 1.2 billion years old) which host the copper mineralisation in fact occur over wide areas of southeast Zambia. We have 3 licences in Zambia which include areas of these rocks and they're also found across the border in Mozambique and we've got an application pending for ground in Mozambique as well. So there is a very large area of Zambia and Mozambique with potential for this type of deposit and we're trying to put a substantial package together for the whole lot.
Tom: But in terms of the deposit which is known as Eagle Eye - I think that's perhaps incorrect. Eagle Eye is only one part of it - the current strike length is 29km but that could be 40km or it could be -
Mark: Yes, the rocks go on for 40km. We've found, so far, evidence of mineralisation along about 29-30km.***

Thanks Safiende it would be good to post this on the other AFE thread which is looked at more. All good news now I hope and also a tip today from Tom Winnifreth on tips.com.

brain2brain - 11 Feb'04 - 17:44
We have noticed that quite often when the number of shares bought exceeds the number of shares sold the share price sometimes goes down ( and in some cases by quite an amount eg African Eagle AFE today..11/2)

After the market makers have sold load of shares, eg after bumping up the price to make a nice fat profit on a company releasing good news, they will want to buy the shares back at a lower price. A large drop might catch out anybody with a stop loss and force them to sell. So it is good business sense for a market maker to drop a price after a spate of buying, particularly if there are stop-losses in place, or if people have bought on credit (T20 etc) or have other terms which might require them to sell later - spread bet?

Yet some share prices increase when there are more sells than buys eg African Diamond AFD, African Gold AFG today etc.

If the market makers have bought a large supply of shares it is in their interest to sell these at a profit. If Joe Public has for some reason been selling, it stands to reason that Joe Public becomes a net buyer when the net selling period ends. To maximize profits, the market maker ought to increase the price when selling drys up. During a selling period they should have lowered the price so that they shell out as little cash as possible for the shares. So even without inflating the price when people become buyers, the price might tend to return to 'normal'.

Can someone please explain why this is, as the number or buys and sells has in the past been key to our trading strategy. Is the information on Ample or Money AM concerning trades not accurate or are we missing something. Any answers / explanations would be really welcome.

Information on buys and sells is not provided, only time, price and quantity. The buys and sells we see are somebody's best guesses, usually the result of a computer program. When in doubt, it is better to look at the trades and decide for yourself. The information is often incorrect.

Whether a price is low or high should really depend on whether people are net buyers (charge them whatever you can get away with) or sellers (give them as little as they are prepared to take). Today's sentiment can be the same or different to yesterdays. So yesterday's sentiment can't really be a guide to today's price trend.

A final note is that market makers can own (or have access to) a huge pile of stock, maybe from a share pracing, and they can have warrants too, or an institutional buyer or seller in the background. So they might be able to sustain long periods of seemingly inbalanced trading.

Minews Story
Date: November 25, 2004

African Eagle Has An Iron Oxide Copper Gold Deposit By The Tail At Eagle Eye And A Possible Gold Mine At Miyabi.

What with an extended rainy season, lack of drills and a queue a mile long at the assay lab it is not surprising that news from AIM listed African Eagle has been a bit sparse over the last few months. The share price suffered as impatient investors tried to make a fortune elsewhere, but they will probably now be wishing that they had stayed put as the company has released very encouraging news from both its Miyabi gold project in Tanzania and the Eagle Eye copper and gold project in Zambia. In the event the company wrong footed one or two commentators as the biggest expectations had been built up for Eagle Eye, but it is Miyabi which now shows every indication of becoming a mine. As a result African Eagle has swiftly made the flight from pure explorer to developer and the share price has been trying to catch up.

3 RNS announcements and the share price up from 14p to 28.75p in 7 trading days.