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Toxic Avenger

07/22/09 1:15 PM

#2856 RE: itlogic #2855

No prob. My advice is not to get too caught up in it, especially with a thinly traded OTC stock. The OTC is just a listing service so companies can put pretty much whatever they want on display (read this and related links if you haven't already - http://www.otcbb.com/investorinformation/investorinfo.stm).
Even on an exchange traded stock, Level II is really only useful if you're a big trader and want to see how "deep" the buys and sells are.
It's not uncommon on the OTC to see a Level II bid of X, then the next bid of 1/2X and think "wow, once those 5k shares get sold, no one is buying until it's 1/2X". The reality is that the market maker showing X could have 100k shares to buy, but 5K is the minimum number, so that's all he shows. In addition, he could have another million share buy at 99% of X, but that would get posted until X is filled. Of course it works the same way on the sell side.
It's fun to watch, but be careful making any decisions based on it.