Because no deal. But he is mistaken, the market is actually open on Monday. So Reid is saying the markets should fall basically. And if Bernanke has the banking holiday off, maybe there will be no buyer for once? Will shorts get paid? The dow went up 420 on hopes of a deal. Any short have any confidence this rigged market will be down even 75 points Monday?
I'm not sure I get the "rigged" concept as it relates to trading. It takes buying to move it up and selling to move it down. What the Fed does, what Congress does, whether the IMF makes a loan to Greece or Spain or doesn't ... all of these actions or inactions are just elements that investors and traders factor in. Some try to do it with fundemental analysis -- not to my taste -- and others (as I do) try to follow the money. IT"S ALWAYS RIGGED! In Rome when the Emporor opened the graneries to the rabble in the street to pacify them, I'm sure there was a merchant who got long just before prices declined. Rigged? Sure, but another merchant had seen other Emporers make the same move (or was a student of history and understood where risk existed) so instead of carrying his full inventory managed the business with half his normal inventory until the crisis abated. Merchant A screams bloody murder while Merchant B sees it as buisness as usual. Merchant A gets pushed to the wall and Merchant B, smelling blood in the water, moves in and buys him out. The reward for being right is large and the price of being wrong is also significant. It's easy to make the case that only fundemental analysis protected Merchant B ... and that would be correct. But remember he is truly an expert in physical grain. I'm not an expert in grain, or silver or crude so I continue to study price in the hope that someday I will be an expert in price action.
OP, For awhile now the Mkt has made a habit of going down on Mondays Not a prediction, rather an observation Donât lose yer water if it decides to again - or not RN
Holiday Monday? lol Will be fun to see the futures Sunday if they haven't solved this by then. Although I'm sure the dip will be bought. Like every other dip.
In the day, when the specialist system was in full force, there was a book by Yale Hirsch ... Don't Sell Stocks on Monday: (http://www.goodreads.com/book/show/3771913-don-t-sell-stocks-on-monday A friend of mine, who was in a position to know, maintained that specialists tried to move stocks to round numbers, 40, 41 etc., on Friday closes because in their experience if they marked them down an eight or a quarter (say 40.75) at the open on Monday they would get a disproportionate amount of small retail buying. They prefeered retail participation because they retail limit orders hang out there to be picked off and in general were easier to trade against. Stock tended to be "locked up" for long periods once small retail owned it. His contention was that specialist always prefeered to trade against a tighter "in play" float ... gave them more control. Since he was in a position to know (he was with Spear Leads and Kellogg when they were the biggest specialist firm on the NYSE floor) I assume -- but do not know -- the information was accurate. I wonder if there are big players that feel the same way today? I wonder if a tighter float is as big an edge now as he believed it was then?
This is were the danger sits. Every single trader me included thinks even if futures drop sunday they're always bought and they have been. But nobody expected the gov't shut down this long. Throw in crap earnings a mkt nears its all time highs and anything can happen. Nobody will even dare say we can fall monday as shorts so destroyed and beaten to a bloody pulp they're terrified. Wow if we do fall monday what a sweet setup to murder all the speculative money that chased this the last 2 days
SN Iâve never been able to correlate float to an edge â and that is not to say youâre friend is / was wrong â nor that an edge doesn't exist - and I simply too stupid to figure it out What I do know is â every one cannot buy â nor can every one sell â for if they do â the mkt soon ceases to exist To make money â price must move â either by nature â or design =================== I know the above doesn't help answer what youâre searching for⦠So hereâs the best I have to hopefully help Expect nothing, always trade what you see Knowing big money at times buysâ¦, sellsâ¦, and must move price around to make money (not talking about the institutions, rather the big hedgies and alike) At times all of them are on the same page⦠other times none of them are on the same page⦠and still other times none of them are present MM sometimes trade.., but mostly are concerned with keeping their risk delta neutral (easier to do when the above participants are absent â or at the open) Big money day traders - identify the likely intra-day direction... then magnify it in the AM... reevaluate mid day to determine if they let it ride..., take profit..., reverse their position... get flat in the PM (before the close) wash... rinse... repeat (assuming no SHTF to the system - then its a balls out scramble for all) RN
RN, None of what I wrote about has the slightest impact on my trading. When I say "I wonder" I meant it in the same sense as on the days I wonder if the blueberries at the corner store will be more ready to eat that the strawberries. I don't wonder much and probably should have been clearer. Nonetheless, thanks for giving it some thought. But I can tell you first hand that plenty of market makers (particularly OTC MM's) held positions more often than one would suspect. I partially financed two small OTC MM's in the 70's (small sums) and as they grew had access to see their positions and it was fascinating. Keep in mind at that time (pre-Nasdaq)an NASD member was required to have $5,000 in net capital ... you could leverage your caital 19 to1. I knew a guy quite well who started Samuel H. Sloan & Co. while his permanent residence was reputed to be Central Park on the blanket he laid on the grass. He had $3,000, wrote up a set of financial statements that said he had $7,000 (audited statements were not then required), rented a tiny office in the delivery district and bingo he was in business. There was no DTC to hold securities and each firm sent runners out to deliver stock and pick up the check. But to clear for yourself you had to be south of Maiden Lane ... the delivery district. A brilliant trader, Sam would trade from the opening bell till the close without ever writing anything down. At the close he would pull out an 8.5" x 14" yellow legal pad and write down the 50, 60 or 70 trades he made that day in the exact order he made them. One of three true genuises I've met in my life. I can't speak to how MM operate today but I can speak definatively as to how operated in the early 70's. It was not at all as it was reported in books, the financial press etc. http://en.wikipedia.org/wiki/Sam_Sloan
Unfortunately knowing someone does nothing for oneâs ability to trade Truth is â neither can I I donât know who is participating, their intention, motivation, or goal⦠I donât know when or if theyâll even participate I donât know how much they intend to buy / sell â when they plan to buy / sellâ¦, or how long theyâll hold before dumping / reversing I have no idea how many overnight/ over weekend orders may come in... or how the MM will stack em I have no idea of the phone calls / pre-arranged deals I have no clue what other traders will be thinking next Monday / week / everâ¦, or the actions they will take â when they will take them - or even if theyâll take them I have no idea which direction price will go⦠or for how long Truly uncertain ======= What I can do..., watch a chartâ¦, cue in on the aggregate actionâ¦, find a point where I think it can be exploited â do so Then accept the results - and move on to the next one I can live with that RN
I hope I didn't leave you with the impression that I thought knowing someone did something for ones ability to trade and I also hope that nothing I said led you to believe that I knew any of the long list of things that you don't know. I also hope that both the blueberries and strawberries are ready to eat.