I don't put a lot of faith in L-II.....for the simple reason that you'll see something akin to what you describe Narmac, 16000 lots asking $2, then you go and buy 1 or 2 thousand of them and the ask will all of a sudden drop.

I used to think...that if I bought into a stock when the ask was thin, that my buying would add to the buy side pressure and push the stock up. I typically start a position in a stock when the volume is light...like here in January of 2014 when I started. But what do I see happen more often? Instead of my buying pushing the PPS up right away....more often than not, the stock trades down.

Why? Simple.....MMs have to provide liquidity to the market, that's one of their primary functions. So even if they don't have shares on offer they will still have a quote on the bid and ask. So a guy like me shows up and buys 10,000 shares of a stock like RVX when its trading for less than 60 cents....and its market order, they'll fill it....even if they don't have the shares, they go short. Now I just bought 10,000 for 58 cents, and if my buy pushes the PPS higher...the MM who sold me the 10,000 shares could be forced to buy them back at a price higher than what I paid....and that MM will lose money on the transaction.

One function of a Market Maker is to provide liquidity yes....but just as important, they have to make money too. So what does the MM who had to go short to fill my order do? He calls his friends, fellow MMs and asks them to move their bids and asks lower.....its called a Move On Request and its been documented by the US department of justice. The other MMs comply with the request because its a quid pro quo system...I scratch your back etc. The other MMs know they'll be in a similar situation at some point and will need the favour returned. And remember....just because a MM is quoting 100 lots for sale at a given price, it doesn't necessarily mean they have a client looking to sell 100 lots....they might they might not.

That's why I call it tea leaves so often....you're guessing.

Anyway that's a long winded answer....we'll know soon enough where the short # is, either Friday or Monday....I don't think it tells the whole tell, but I do think it is valuable info and can give an indication of where things are going.