Among common asked by financial market followers in general, and the stock market participants in particular is a question related to the dynamics of the stock market price formulated in a number of ways such as this: why did the stock market rise today (or why the stock market fell today)? A common (and incorrect) answer is that the demand was higher than the offer of stock, which is inconsistent with the fact that for each buyer there is a seller, and vice-versa.

Stock market follow an auction process. Let us assume that there is a trade at each price increment (we however note that prices do not need filled trades to rise as discussed below). The stock market price rises when the offer trades out and goes bid, that requires more buying than selling at the price where the offer was available. The same can be said for the next offer, "ad infinitum", as price rises.

The stock traders and investors who think of the price behavior along the lines of the above mentioned misconception might confuse the demand for stocks at a given price, with filled trades. In fact, filled trades are not a requirement for a stock market price to change. One could see it in a less liquid stock, but it may be better understood if look at in the context of a regular non stock market auction, where no trades take place until the final bid, yet the price of a non-stock-market auction changes many times as it goes up.

There are important consequences to the above observations, as related to the analysis of stock market buying and selling. At any give day, if the stock market price is rising, the notable price where the stock market demand has last exceeded the stock market offer the day before is the price low of the previous day. This might be a reason why stock market experts would usually suggest in the financial literature to their readers to pay attention to the low price of the precious day in a rising stock market. A similar analysis can be extended to a stock market in a retreating price trend.

We will discuss other consequences of the above observations in relation to the analysis of stock market reversals, and why daily lows and daily highs can be important in the analysis of the stock market demand and offer, and their interaction.

It might be be useful to apply the above observation to some liquid stocks(both rising stocks and declining stocks). Below is a list of stocks that may be useful in doing the exercise.


A list of stock gainers for today's stock trading session:

Ticker Company Sector Industry
PRKR Parkervision Inc. Technology Semiconductor - Integrated Circuits
SFN SFN Group, Inc. Services Staffing & Outsourcing Services
HEAT SmartHeat Inc. Industrial Goods Industrial Equipment & Components
SINO Sino-Global Shipping America, Ltd. Services Air Delivery & Freight Services
GRO Agria Corporation Consumer Goods Farm Products
MRNA Marina Biotech, Inc. Healthcare Biotechnology
CBAK China BAK Battery, Inc. Industrial Goods Industrial Electrical Equipment
RHI Robert Half International Inc. Services Staffing & Outsourcing Services
KNDI Kandi Technologies, Corp Consumer Goods Trucks & Other Vehicles
MLNX Mellanox Technologies, Ltd. Technology Semiconductor - Broad Line
MHS MedcoHealth Solutions Inc. Services Drugs Wholesale
IRE The Governor and Company of The Bank of Ireland Financial Foreign Regional Banks
NBG National Bank of Greece SA Financial Money Center Banks
CTIC Cell Therapeutics, Inc. Healthcare Biotechnology
DTLK Datalink Corp. Technology Business Software & Services
MMI Motorola Mobility Holdings, Inc. Technology Diversified Communication Services
MS Morgan Stanley Financial Investment Brokerage - National
ACHN Achillion Pharmaceuticals, Inc. Healthcare Biotechnology
XPO Express-1 Expedited Solutions Inc Services Trucking
MIPS MIPS Technologies Inc. Technology Semiconductor- Memory Chips
BCS Barclays PLC Financial Foreign Money Center Banks
EGLE Eagle Bulk Shipping, Inc. Services Shipping
ABAT Advanced Battery Technologies, Inc. Industrial Goods Industrial Electrical Equipment
VLNC Valence Technology Inc. Industrial Goods Industrial Electrical Equipment
ALXN Alexion Pharmaceuticals, Inc. Healthcare Drug Manufacturers - Other
ALAN Alanco Technologies Inc. Technology Data Storage Devices
FEED AgFeed Industries, Inc. Consumer Goods Processed & Packaged Goods
IDCC InterDigital, Inc. Technology Wireless Communications
AIS Antares Pharma Inc. Healthcare Medical Instruments & Supplies
MKSI MKS Instruments Inc. Industrial Goods Diversified Machinery
LYG Lloyds Banking Group plc Financial Foreign Money Center Banks
GSX Gasco Energy Inc. Basic Materials Independent Oil & Gas
PPC Pilgrim's Pride Corporation Consumer Goods Meat Products
LTM Life Time Fitness Inc. Services Sporting Activities
TCBI Texas Capital BancShares Inc. Financial Regional - Southwest Banks
YRCW YRC Worldwide Inc. Services Trucking
LECO Lincoln Electric Holdings Inc. Industrial Goods Small Tools & Accessories
REE Rare Element Resources Ltd. Basic Materials Industrial Metals & Minerals
MCP Molycorp, Inc. Basic Materials Industrial Metals & Minerals
AIB Allied Irish Banks plc Financial Foreign Money Center Banks
CHSI Catalyst Health Solutions, Inc. Financial Insurance Brokers
ESLR Evergreen Solar Inc. Technology Semiconductor - Specialized
GFA Gafisa S.A. Industrial Goods Residential Construction
RBS Royal Bank of Scotland Group plc Financial Foreign Money Center Banks
EK Eastman Kodak Co. Consumer Goods Photographic Equipment & Supplies
PANL Universal Display Corp. Technology Computer Peripherals
ARNA Arena Pharmaceuticals, Inc. Healthcare Biotechnology
SF Stifel Financial Corp. Financial Investment Brokerage - Regional
GR Goodrich Corp. Industrial Goods Aerospace/Defense Products & Services
FAS Direxion Daily Financial Bull 3X Shares Financial Exchange Traded Fund
CBB Cincinnati Bell Inc. Technology Telecom Services - Domestic
CS Credit Suisse Group Financial Foreign Money Center Banks
FBC Flagstar Bancorp Inc. Financial Savings & Loans
NOK Nokia Corporation Technology Communication Equipment
PENN Penn National Gaming Inc. Services Resorts & Casinos
ERX Direxion Daily Energy Bull 3X Shares Financial Exchange Traded Fund
VFC V.F. Corporation Consumer Goods Textile - Apparel Clothing
WCC WESCO International Inc. Services Industrial Equipment Wholesale
FIG Fortress Investment Group LLC Financial Asset Management
CE Celanese Corp. Basic Materials Chemicals - Major Diversified
NR Newpark Resources Inc. Basic Materials Oil & Gas Equipment & Services
GTE Gran Tierra Energy, Inc. Basic Materials Independent Oil & Gas
XIV VelocityShares Daily Inverse VIX ST ETN Financial Exchange Traded Fund
NABI Nabi Biopharmaceuticals Healthcare Biotechnology
ESRX Express Scripts Inc. Healthcare Health Care Plans
ING ING Groep NV Financial Life Insurance
SLTM Solta Medical, Inc. Healthcare Medical Appliances & Equipment
BBVA Banco Bilbao Vizcaya Argentaria, S.A. Financial Foreign Regional Banks
AVNR Avanir Pharmaceuticals Healthcare Drug Manufacturers - Other
GERN Geron Corporation Healthcare Biotechnology
KND Kindred Healthcare Inc. Healthcare Medical Instruments & Supplies
EDC Direxion Daily Emrg Mkts Bull 3X Shares Financial Exchange Traded Fund
PWAV Powerwave Technologies Inc. Technology Communication Equipment
ZQK Quiksilver Inc. Consumer Goods Textile - Apparel Clothing
ACTG Acacia Research Corporation Services Research Services
ETFC E*TRADE Financial Corporation Financial Investment Brokerage - National
AEG AEGON N.V. Financial Life Insurance
PM Philip Morris International, Inc. Consumer Goods Cigarettes
RIMM Research In Motion Limited Technology Diversified Communication Services
SXCI SXC Health Solutions, Corp. Technology Application Software
DDD 3D Systems Corporation Technology Application Software
PHG Koninklijke Philips Electronics NV Consumer Goods Electronic Equipment
NVDA NVIDIA Corporation Technology Semiconductor - Specialized
VMED Virgin Media, Inc. Services CATV Systems
EWI iShares MSCI Italy Index Financial Exchange Traded Fund
GTI GrafTech International Ltd. Industrial Goods Industrial Electrical Equipment
GES Guess? Inc. Services Apparel Stores
WLT Walter Energy, Inc. Basic Materials Industrial Metals & Minerals
UNP Union Pacific Corporation Services Railroads
DF Dean Foods Co. Consumer Goods Dairy Products
BX The Blackstone Group Financial Asset Management
RBCN Rubicon Technology, Inc. Technology Semiconductor - Specialized
DB Deutsche Bank AG Financial Foreign Money Center Banks
HNR Harvest Natural Resources Inc. Basic Materials Independent Oil & Gas
RJF Raymond James Financial Inc. Financial Investment Brokerage - Regional
STD Banco Santander, S.A. Financial Foreign Money Center Banks
ZLC Zale Corporation Services Jewelry Stores
SCS Steelcase Inc. Consumer Goods Business Equipment
VLO Valero Energy Corp. Basic Materials Oil & Gas Refining & Marketing
AMKR Amkor Technology, Inc. Technology Semiconductor - Integrated Circuits


A list of stock losers for today's stock trading session:

Ticker Company Sector Industry

TZOO Travelzoo Inc. Technology Internet Information Providers
NTWK NetSol Technologies, Inc. Technology Application Software
SIFY Sify Technologies Limited Technology Internet Service Providers
VIVO Meridian Bioscience Inc. Healthcare Diagnostic Substances
STX Seagate Technology PLC Technology Data Storage Devices
KAD Arcadia Resources Inc. Healthcare Home Health Care
SABA Saba Software, Inc. Technology Business Software & Services
GNW Genworth Financial Inc. Financial Life Insurance
REDF Rediff.com India Ltd. Technology Internet Information Providers
FFIV F5 Networks, Inc. Technology Application Software
CRUS Cirrus Logic Inc. Technology Semiconductor - Specialized
TVIX VelocityShares Daily 2x VIX ST ETN Financial Exchange Traded Fund
TEX Terex Corp. Industrial Goods Farm & Construction Machinery
ZINC Horsehead Holding Corp. Basic Materials Industrial Metals & Minerals
EGHT 8x8 Inc. Technology Communication Equipment
CDTI Clean Diesel Technologies Inc. Basic Materials Chemicals - Major Diversified
REVU Princeton Review Inc. Services Education & Training Services
PLXS Plexus Corp. Technology Printed Circuit Boards
WWWW Web.com Group, Inc. Technology Internet Information Providers
SWY Safeway Inc. Services Grocery Stores
WSTL Westell Technologies Inc. Technology Communication Equipment
ERIC LM Ericsson Telephone Co. Technology Communication Equipment
HLIT Harmonic Inc. Technology Communication Equipment
IR Ingersoll-Rand Plc Industrial Goods Diversified Machinery
SCEI Sino Clean Energy Inc Basic Materials Synthetics
QPSA Quepasa Corp. Technology Internet Information Providers
WDC Western Digital Corp. Technology Data Storage Devices
AMR AMR Corporation Services Major Airlines
ARUN Aruba Networks, Inc. Technology Networking & Communication Devices
NEWN New Energy Systems Group Technology Diversified Electronics
N NetSuite Inc. Technology Business Software & Services
COOL Majesco Entertainment Co. Technology Multimedia & Graphics Software
RDN Radian Group Inc. Financial Surety & Title Insurance
PLCM Polycom, Inc. Technology Processing Systems & Products
AF Astoria Financial Corporation Financial Savings & Loans
FAZ Direxion Daily Financial Bear 3X Shares Financial Exchange Traded Fund
POOL Pool Corp Consumer Goods Sporting Goods
SINA Sina Corp. Technology Internet Software & Services
VALV Shengkai Innovations, Inc. Services Industrial Equipment Wholesale
ABC AmerisourceBergen Corporation Services Drugs Wholesale
CLSN Celsion Corp. Healthcare Medical Appliances & Equipment
QLIK Qlik Technologies, Inc. Technology Business Software & Services
MTG MGIC Investment Corp. Financial Surety & Title Insurance
TAT TransAtlantic Petroleum Ltd. Basic Materials Oil & Gas Drilling & Exploration
EW Edwards Lifesciences Corp. Healthcare Medical Appliances & Equipment
ALTH Allos Therapeutics, Inc. Healthcare Drug Manufacturers - Other
OCZ Ocz Technology Group Inc. Technology Data Storage Devices
ERY Direxion Daily Energy Bear 3X Shares Financial Exchange Traded Fund
HAFC Hanmi Financial Corporation Financial Regional - Pacific Banks
APKT Acme Packet, Inc. Technology Communication Equipment
VXX iPath S&P 500 VIX Short-Term Futures ETN Financial Exchange Traded Fund
WAG Walgreen Co. Services Drug Stores
CAVM Cavium Networks, Inc. Technology Semiconductor - Broad Line
URZ Uranerz Energy Corp. Basic Materials Industrial Metals & Minerals
EDZ Direxion Daily Emrg Mkts Bear 3X Shares Financial Exchange Traded Fund
TSCO Tractor Supply Company Services Specialty Retail, Other
ESI ITT Educational Services Inc. Services Education & Training Services
CRM Salesforce.com Technology Application Software
CAKE The Cheesecake Factory Incorporated Services Restaurants
DVR Cal Dive International Inc Basic Materials Oil & Gas Equipment & Services
SHW The Sherwin-Williams Company Services Specialty Retail, Other
PMI PMI Group Inc. Financial Surety & Title Insurance
OPEN OpenTable, Inc. Services Business Services
CLB Core Laboratories NV Basic Materials Oil & Gas Equipment & Services
NRGY Inergy, L.P. Services Specialty Retail, Other
BRD Brigus Gold Corp Basic Materials Gold
SPXU ProShares UltraPro Short S&P500 Financial Exchange Traded Fund
FTNT Fortinet Inc. Technology Computer Peripherals
RENN Renren Inc. American Depositary Technology Internet Information Providers
TIBX Tibco Software, Inc. Technology Business Software & Services
DANG E-Commerce China Dangdang Inc. Services Catalog & Mail Order Houses
PAY VeriFone Systems, Inc Consumer Goods Business Equipment
SWI SolarWinds, Inc. Technology Application Software
BGZ Direxion Daily Large Cap Bear 3X Shares Financial Exchange Traded Fund
SKF ProShares UltraShort Financials Financial Exchange Traded Fund
SWKS Skyworks Solutions Inc. Technology Semiconductor - Integrated Circuits
AGQ ProShares Ultra Silver Financial Exchange Traded Fund
UTEK Ultratech, Inc. Technology Semiconductor Equipment & Materials
USAT USA Technologies Inc. Services Business Services
WHR Whirlpool Corp. Consumer Goods Appliances
IEX IDEX Corporation Industrial Goods Diversified Machinery
NETL NetLogic Microsystems Inc. Technology Semiconductor- Memory Chips
MTOR Meritor, Inc. Common Stock Consumer Goods Auto Parts
HBAN Huntington Bancshares Inc. Financial Regional - Midwest Banks
PRXL Parexel International Corp. Healthcare Medical Laboratories & Research
DO Diamond Offshore Drilling Inc. Basic Materials Oil & Gas Drilling & Exploration
CBE Cooper Industries plc Conglomerates Conglomerates
PEP Pepsico, Inc. Consumer Goods Beverages - Soft Drinks
SEIC SEI Investments Co. Financial Asset Management
KOG Kodiak Oil & Gas Corp. Basic Materials Oil & Gas Drilling & Exploration
MTW Manitowoc Co. Inc. Industrial Goods Farm & Construction Machinery
GBG Great Basin Gold Ltd. Basic Materials Gold
BIDU Baidu, Inc. Technology Internet Information Providers
ADS Alliance Data Systems Corporation Financial Credit Services
CIGX Star Scientific, Inc. Consumer Goods Cigarettes
TQNT TriQuint Semiconductor, Inc. Technology Semiconductor - Integrated Circuits
SOL ReneSola Ltd. Technology Semiconductor - Integrated Circuits
SWFT Swift Transportation Co., LLC Consumer Goods Trucks & Other Vehicles
SCSS Select Comfort Corporation Consumer Goods Home Furnishings & Fixtures
HEV Ener1, Inc. Industrial Goods Industrial Electrical Equipment

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