Discussion in 'Trading' started by inandlong, Nov 11, 2003.
Is there any?
How should it be interpreted?
Institutions like to trade in blocks, block activity gives you good indication what is up, especially depending if the block took place below above ior n between the bid and ask. We have an alert for it and I use it all the3 time.
Block trade , a trade of 10.000 shares, is in my opinion not really important, BUT...
I do think it's important to follow the direction of the 'larger trades' on the tape. It depends on the volume of the stock if these are block trades or other quantities.
I have used a platform that gave block trades and block volume and one that did not (eSignal). Did having this data make me any more money. I would have to say no. However, I really like the idea of have some idea of what the big guys are doing.
Hey guys thanx for the replies.
I suspect that your answers are based on an intraday view, and it is my bad for not being more clear about what I was looking for.
Today I was looking at some stocks after the close. And I was thinking about the relationships among total volume, float, and block trade volume. I noticed that some stocks had a very high percentage of total volume trade as block volume, etc. So I was wondering what significance this has, if any, on the future direction of the stock.
Thanks for your help on this.
It does make a lot of difference IF you know what to look for.
And it is even more important intraday BUT... IF the issue is heavily traded then it may not be that noticeable.
In addition it is often "manipulated" to give a different impression. All smoke and mirrors.
Tapereading is an essential skill and you cannot do this without knowing what the big boys are doing.
It has been said by Gerald M Loeb in 1963: "It is time we saw a renaisance of tape reading. Thoroughly understood it should prove far more rewarding then the current "chart" fad.
The emphasys is on "thoroughly" - it has been stated that the computer has made this an obsolete skill, however I disagree with that.
Elsewhere Loeb mentions that it is possible to do tapereading only and make a decent living.
Hope this helps and inandlong I am thoroughly enjoying your postings. Keep the good things coming.
Steve Woods has written a book on this and has a web site. http://www.floatanalysis.com/. You may want to check it out. Listed on his site is software to measure this. QCharts has this but Steve does not have them listed.
I think this question has a relativistic answer to it. Did the spike print after a gap up? Was a trendline or price channel broken? Is this a cyclical issue? What percentage of the float was the print? What timeframe was this on? What is the relation of this issue with it's industry and sector group?
Perhaps you could post charts and scenarios.
First, thanks for the helpful replies bali' and Jabez.
oddi, actually this question came to mind while looking over some Herhey stocks. I forget which one it was, but 65% of the total volume that day had been done by block trades. And the stock was one of those with maybe 2 million shares. So it made me wonder if anyone knew of the correlation, if any, between block trading volume and multi-day direction.
I see on the internet there are some studies that I can download via pdf so I'll read those too.
Ahhh, okay. If it a hershey stock, then it's time to think about getting out. Go to the 30 min chart and watch for a trendline break. But I am sure you knew that already
Since this is a statistics excercise, I presume, it would interesting if someone could produce a bell curve on that subject.
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