Hi Don, A brief question to you: Why didn't you adsjust GE to the opening indication? The indication was 25.25 - 25.75 and it opened at 25.65. According to previous posts you should have a buy order around 25.4 (adjusted)?
Very perceptive, and you're right....I failed to adjust the order on time...(was still chatting with the "bootcampers" about the morning envelope). Glad to see you are paying attention... Don
Scratch morning.. FRE short -.15.. went my way just a bit, then had a gap up, panicked out at the top. It went on to make a nice short.. CB was watching the opening inducators, when it indicated way past my short, went to cancel, Oops.. too late... CB short, +.15 canceled quickly anyway, just happened to get +.15 CB would have dealt me some grief if I hadn't gotten loose so quick.
Don, how do you check on these for twenty stocks, esp. as some of them are coming out so close to the bell, so that you can have time to adjust if need be. Appreciate all the info. XGG
Assuming specialists make $ and trading w/ them provides an edge, how do you feel about jumping in when the specialist is getting steamrolled? OMG yesterday for example, or CI last week. What tricks are in the specialist playbook for a situation like that? Is he able to get short, and cover lower, or is he getting longer & longer as the day(s) drag on?
I am generally within the "range" of the pre opening indications, based solely on FV determination. But if there is a big discrepancy, then I do my best to modify the bid (when indicated lower), and sell price (when indicated higher) ...to the bottom or top 1/3 of the indicated range. As far as "how"....I keep my opening spreadsheet on my left monitor, and my Redi quote window on the right monitor, and simply compare the two. Don
Good questions: When a stock (or Specialist) is "getting steamrolled" (rarely), you will still see minor offset moves. In CI for example: When the stock opened for the day, down a few dollars, it still upticked a full 20 cents before heading South again. The Specialist will be able to trade both sides of the market, participating in "prints" (larger blocks of stocks) on both sides. It is doubtful that the Specialist will continue to get "longer and longer" during any sustained move. It happens, but not very often. Remember, the idea of trading with the Specialist is to have high probability trade enties and exits, which is what you will likely have....not perfect, but high probability. Don
Don, I am confused by your use of the term "indications." At other firms, the term is used ONLY when the stock is indicated to have a delayed opening [there is an order imbalance that the spec has not been able to resolve at the open.] The term used for stocks that are not thought to be delayed and should open in a "timely" manner are described using the term "pre-market." Please correct me if I am wrong about the usage, or if I am right and your use of the terms are "Bright" specific. nitro
Not neccesarily "Bright specific" - but they are only broadcast on certain networks. Redi broadcasts the "opening indications" that the Specialist puts out. I think they broadcast anything more than about 35 cents variance from the previous day's close, similar to a trading halt/re-open. Yesterday, on my quote window. for example, there were about 15 out of 25 stocks that showed a pre-opening indication. This is very helpful to a good opening strategy. Don