I am thinking of using a cumulative volume indicator (sum of bid and ask for a day). The idea is to track the order flow.
How the indicator is built:
1. It starts every day from zero
2. The bid amount for each bar is subtracted from the total amount
3. The ask amount for is added to the total amount
4. I plot the indicator as a line
I trade mainly NASDAQ stocks (e.g. AMAT, KLAC). A strange effect I observed is that on some days there is clear "bid" pressure (the transactions take place at bid), but the stock is going up. A kind of divergence, not what I would expect.
Why such divergence, do you have any idea?
How the indicator is built:
1. It starts every day from zero
2. The bid amount for each bar is subtracted from the total amount
3. The ask amount for is added to the total amount
4. I plot the indicator as a line
I trade mainly NASDAQ stocks (e.g. AMAT, KLAC). A strange effect I observed is that on some days there is clear "bid" pressure (the transactions take place at bid), but the stock is going up. A kind of divergence, not what I would expect.
Why such divergence, do you have any idea?