# Last edited on 2014-02-06 19:52:05 by stolfilocal
# Not posted

[quote author=kkaspar link=topic=178336.msg4980530#msg4980530 date=1391718464]
Because the price was kept stable artificially, with releasing upwards or downwards pressure as soon as the price started to move away from 800.
[/quote]

If the market has convinced itself that 800 is the "right" price, and a single large dump or gobble comes from nowhere and suddenly changes the price to 700 or 900, then the rest of the market will promptly correct that trader's "stupid error" and restore the "right" price.  

I have been told that this "natural single-error correction mechanism" is seen in the stock market, too.

So, it would probably take a cluster of several notable transactions, all pushing the price in the same direction (such as could be triggered by an external event), to cause a large [i]and persistent[/i] price change.

It takes some time for the market to change its mind and become convinced that, yeah, the old price was "too high" or "too low". Then the price will trash around for a while, until the market converges on a new consensual "right" price.

In the absence of such multiple dumps or gobbles, and ignoring the "freak" blip-blops, the price should only change gradually, by the accumulation of little random steps, as in a Brownian process.