It's not reasonable to assume that a human changed their mind that quickly. The idea of putting out an offer with the intention of changing your mind and letting a computer handle that process cements the point that its not a change of mind here, more likely an intentional misrepresentation of buying pressure - otherwise what's the point?This is not what changing someone's mind looks like.
fleitz|10 years ago
If someone sends a buy order to the exchange that quote is listed on for the same amount of shares, it will fill the entire order. What is happening here is that there are multiple exchanges and when the algo sees an order come in on one exchange it cancels orders on other exchanges quickly disseminating price information as liquidity evaporates at the current price.
The point of price is to disseminate information about the supply and demand of a good. When demand goes up price increases. The buyer is buying because he thinks the price will be higher in the future.
Both are motivated by profit, at a certain point the buyer will no longer be interested in buying at that price. The buyer obviously has a piece of information the algo doesn't and is equally trying to capitalize on the algos lack of knowledge of that information.
In the case in point the order was ~60% filled. The price the order was submitted at reflects the 'current' demand, not the demand after the order is submitted. It's pretty good to get a 60% fill when you are buying 83% of the currently available stock.
omgtehlion|10 years ago
Those orders were resting there for a long time, it was not flashing.
Like you selling two adjacent houses and see a buyer purchasing one and wanting to purchase another. You understand that he/she wants the house really badly and increase the price for the second house.