I don't get it with their ranking system. I have a 4 star app with 5 votes and been at the 400-500 spot for few months. Couple weeks ago with same amount of votes and still at 4 star, the app ranked 140 in Communications. The sales started to shoot up and then couple weeks later with same votes and still a 4 star app it dropped back to the 450 range. Sales are down It was good while it lasted, but I don't get what happened with sudden drop in ranking.
From my personal experience, it depends not only on the number of installations but there are some other hidden factors. However, I still don't have full picture.
My application was #1 in Top New Free in my country(because it was localized only in our native tongue) and I had say 350 downloads/day. It slowly started dropping down to reach 40-50 daily downloads now.
Do an experiment, provide an update and see what happens
Yeah its pretty weird. I had put out updates on my apps last week, and I'm guessing from the number of "downloads" (which is really just the current users updating) 2 of my apps went #1 & #2 in Top Paid Apps in their category.