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surfkast

03/01/18 1:57 PM

#65862 RE: hh718 #65860

Much of the short volume is due to market makers selling into the market a few fractions of a second/minute/hour before they close their position by executing a broker order. Due to the fact that market makers cover many of their positions seconds later, much of the short volume isn’t necessarily an indication of useful bearishness. The fact that a market maker is willing to sell and cover seconds later doesn’t do an investor holding the stock for the long term any good. The market maker could be bullish on the stock long term, and still be willing to short temporarily to satisfy a client request. Similarly, many market makers often have to go short in a fast market in order to fulfill their job of providing liquidity. Other market makers will widen their bid ask prices enough to get out of that scenario.


http://volumebot.com/why-short-volume-is-important/