Can you tell volatility & trend pre-market?

Discussion in 'Trading' started by jimclark, Mar 23, 2007.

  1. I run a pre-open scan of gapping Up and Down stocks on NAZ, NYSE, AMEX. Obviously some stocks go surge or drop as much as 25-40% eaither dirction.

    While % change gives good indication I am not able to see or read volatility of hte stock, I've done pretty good entering first within first 3 minutes and riding the stock in the direction of the gap, mostly LONG or wait for 5 minutes after open and buy deepest drops, from my experience regardless of the direction of the day's market these laggers tend to pullback within 10-25 minutes after sharp gapped down open...but eventially will end up down and lowe for the day but first 30 minutes result in pullback if you enter right it seems to make you some money.

    Is it possible to identify volatility of hte pre-open stock?

  2. I did a study of the most profitable trade direction for stocks gapping premarket, both up and down. Unfortunately, the probability for my samples were about equal.
  3. Hoodoman,
    What do you mean was equal?
  4. Futures can give you a very good idea how the stock or index is gonna open. If it differs to much from the previous close you can bet volatility will be higher.

    After the open virtually ANYTHING can happen, tough.
  5. atozcom


    No. There is no reliable way tell tell what is the NEXT price move or volatility move otherwise one would become a fortune teller!!! You can not even have a reliable 51% which is better than a coin flip.

    However, there is only three possibility: Up, down, or stay. Can Coin flip don't have three possiblity? Head, tail or "stand"?

    The only thing you can guarantee is that price will fluctuate. It will either fluct up, fluct down or no fluct at all.
  6. Big AAPL

    Big AAPL


    Just out of curiosity, why do you want to identify the volatility of stocks before the open? It sounds as if your already doing a succesful job by identifying volatile stocks with your pre-market gap scan.

    Are you trying to optimize and tweak your system?

    Also, how are your fills and are you using market orders?