Typing this to articulate some of my thoughts.
Supply-driven markets are said to move the price action more violently than demand-driven ones. When the supply of a stock is increased or promoters sell deliberately and rumors of further damage swirl, the trend shoots down.
This makes the supply-driven markets more volatile with wider channels, making profit targets bigger. The crux of this is that the two most important aspects of trading - liquidity and volatility - are housed by supply-driven incentives. No less than implying that discretionary, not systematic, trading matters more often than not, fortunately or unfortunately.
Anyway, I also think this has a first-order relation to the absorption of orders by market makers. Supply-driven momentum moves price action despite the conditions of market depth. For example, increasing (open) sell orders can still drive prices up by supply-driven absorption.
I'm looking for what you think. Here for more opinions/criticism against what I said. And do you have a method for judging supply-driven predictions, analyzing market depth, or both?