Hi Mitta3, the depth needs to be closely analysed to have any real significance. Also from my perspective the vwap is a truer guide of the action for the day rather than the closing price. The closing auction by its very nature can be manipulated to give an outcome that is not reflective of the trading action during the rest of the day. During the auction the price can be lowered or upped on low volume distorting the outcome compared to the price at which most shares were traded that day.
With market depth I always check the buy/sell numbers close to the real action and give little if any weight to the numbers more than about 8 ticks down. If one checks the current market depth for PRR it reflects in total that there are more than twice as many buys compared to sells. However, if you look at the first line where the action is there are actually more to sell at 19.5c than there are to buy at 19c. Also if one goes down eight ticks there are approx 16.5mill shares to buy versus 14mill sells, a far cry from what I call the fake picture provided by the overall buy and sell figures that show twice as many buys than sells.
Still on the day the vwap was 19.8c and thats not a bad result.
cheers
PRR Price at posting:
16.1¢ Sentiment: Buy Disclosure: Held
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