Traders often make decisions based on traditional price charts, which simply show the last price, not whether traders are lifting offers or hitting bids.
If the inside market is dropping and the last price is testing support on a standard price chart, it is beneficial to know precisely what other traders are doing. For example, if fewer bids were being hit as the bid dropped (indicating traders were doing less selling on the way down), and then the majority of traders started lifting offers, the implication is support will hold.
The charts shown here illustrate that when an important economic number is released, the inside market can change at a dramatic rate and become chaotic, with wide bid-ask pairs and little volume or size. Traders should understand how the market conditions (the inside market) can change in reaction to an economic release, as that affects fills.
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