At 7:02 am PST or 32 minutes after the open, both QQQ and SPY had large increases. Does anyone know why their prices tend to move together?
QQQ is the ETF that tracks the Nasdaq 100. SPY is the ETF that tracks the S&P500. ie, they trade almost in unison with the Nasdaq 100 and the S&P500. The Nasdaq 100 and S&P500 are major US stockmarket indexes and as a result trade very much in unison with each other most of the time. Major economic releases are released at 10:00am EST most days and they tend to make the market move somewhat quickly. The price spike in QQQ and SPY at 10:02 would be a result of the news release at that time (yesterday it was ISM Services). It would be more unusual if one of them moved a lot and the other didn't.
I asked this question because I wanted to understand what fundamentally drives a stock¡¦s price, and was not particularly interested in that specific point only, but the entire day¡¦s price movements in general. For example, for almost every trading minute of every trading day, most tech stocks will move in unison with QQQ. Is this because the same/different day traders are trading all of these stocks in EXACTLY the same way? If you answered YES to the previous question, then it should be clear that opportunities can be easily exploited with a little help from a neural network. Still laughing? Eel