How come

Discussion in 'Commodity Futures' started by stock777, Aug 6, 2010.

  1. Not a commode specialist, but seems that at limit down or up theres an awful lot of trade. You would think the opposite.

    Anyone have an intelligent opinion on this?
  2. 1) Sep Wheat?
    2) When futures touch a price-limit, there can still be trading at the limit-price as long as the options aren't trading "synthetically" beyond the price-limit. Otherwise, it wouldn't make sense to "fade" the limit-price when you can get a better price fill in the options instead.
    3) There can be an unwillingness to carry positions overnight and over the weekend with lock-limit settlements because there's no guarantee of followthru to the next session.
    4) A "large trader" could come in towards the end of the trading session and "take out" the pool of unfilled orders at the limit and cause a big reversal in the market, off of the limit. :cool:
  3. not really what im seeing at all.

    lock limit down would imply desperate sellers.

    if no limit price would likely be much lower

    despite that , buyers are willing to take the offer in SIZE. doesnt look like one large buyer to me

    seems odd
  4. ps. there seems to be next to NO options trading at all on ZW
  5. 1) Yes, true.
    2) Yes, agreed.
    3) Okay. What significance is there to "that". It'll be hilarious if the market opens strongly higher Sunday evening. A down-limit is an opportunity to buy many contracts in one "swoop". :cool:
  6. Try using the symbol "W" instead. :)
  7. fraid not ,W is white sugar on IB.

    IB's shows the options on ZW as fairly thin action.

    Anyone have a better idea?
  8. there's more than plenty of options trading in wheat

    anyway that's the online platform which still may not have gotten too off the ground, and it's through IB so I'm inclined to not trust it as much, not sure why.

    Anyway there is plenty of trading on the limit because not everybody really believes wheat is going to go crashing down to where it came from, maybe a cereal company thinks it's a good opportunity to buy and doesn't want to miss out...who knows. There is also plenty of arbitrage opportunities if you can get lifted on your limit down offer and buy the synthetic in the pit...or somebody did an options trade for edge in the pit and doesn't really care much about doing synthetics against it so they just lift the limit down offer...

    I've noticed past few days they'll come in with 10k+ offered on limit down then all of a sudden it'll be gone and it'll come off limit so maybe somebody playing games who knows?
  9. also sometimes these limits act as a reality check for everybody in the market, it's not like the fires in Russia are over and nobody wants to own wheat anymore, You really have to see where the ATM synthetic is trading which is hard to do from just an IB screen if they don't show options trading on the screen...also, if we are limit down and/or just crazy as it has been there is no way anybody is going to be putting up markets so that would be a good reason as well for it being so thin, just another reason why we still need a pit.
  10. limit down buyers Fri looking like shmucks here
    #10     Aug 8, 2010