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Yea, but as soon as you buy all his stock, someone else who has had some stockpiled, or just made some, will throw up more of the same materials. If he throws up 5 stacks, and 10 people want to buy a stack of this material. He has taken 5 potential sales away. If you bought more then 5 stacks from the original guy that you re-listed, then your most likely going to lose money.
It's entirely possible to do it, but you have to be logged on alot of the time that your auctions are up, checking the AH every 5-10 minutes, to buyout anyone who lists at a cheaper rate. I've done it before with runecloth, back when supply was lower and demand was higher then it is now. Made about 30g in one day just buying and selling it, and then another 50g in subsequent days selling the remaining stacks at a more normal price (though still high, as my day of monopoly had driven prices up for a few days) when I wasn't on enough to keep my iron fist on the market.
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