It can be very difficult to judge based on a single point of light as druidh says, especially so given the wide variation in cyclist speeds on the road from a couple of Mph to ~20 in some cases and a lot of people don't expect cyclists to be travelling quickly.
The wide variation in brightness of lights doesn't help either, makes it even harder to tell if what is approaching and how far away it is as bright light at a distance is easily equivalent to dimmer light closer, and a very bright light up close is dazzling and makes it even worse, modern car headlights are just as bad.
Your eye instinctively reacts to a bright light by *reducing* the amount of light it lets in by constricting (and often you squint or turn your head too), reducing your visual field and it also acts to reduce sensitivity to other dimmer objects in your field of vision this is NOT helpful when you need to observe what is going on around you.
What you need is to be sufficiently brightly lit up to be noticed and visible, and stand out form your surroundings but without being so bright that it causes other problems, and not directed into the eyes of other road users as that's when problems occur.
I have the same problem as a cyclist in judging other cyclists approach speeds at times.
I think another problem is the need to remind people that when you can't judge it quickly and easily then your default behaviour should be to NOT do anything until you ARE sure of the speed and direction of approach, rather than just assume it's OK and carry on.