Why stocks will have gap up/down opening?
- Thread starter srinivas.nukala
- Start date
First reason is exploiting people's greed or fear by the operators (fund managers, brokers)
Second, The traders expect price may fall or rise based on their assumptions, so they they put price above market when hoping market may go up or sell at lower price when expecting that prices may fall.
Two reasons which i think of,
1. exploitation by big players
2. fear greed of of retail investors.
Second, The traders expect price may fall or rise based on their assumptions, so they they put price above market when hoping market may go up or sell at lower price when expecting that prices may fall.
Two reasons which i think of,
1. exploitation by big players
2. fear greed of of retail investors.
the gaps r due 2 overnigft fear or euphoria before the mkt re-opens again......the in between time news or event which is captured in the nxt opening....
in monthly charts v rarely find gaps as it will capture the time between the mkt closing of the month & the opening for the fresh month....just a single session
in monthly charts v rarely find gaps as it will capture the time between the mkt closing of the month & the opening for the fresh month....just a single session
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Thank you for giving me the reply.Kindly let me know the following also
1)HOW OPERATORS CAN PLACE ORDER IN NON-TRADING HOURS OF THE MARKET WHEN MARKET IS CLOSED?
2)I'm a position trader.I'Ve on line demat account of icici direct.Can i place delivery buy/sell order beyond working hours of market?If so how?
1)HOW OPERATORS CAN PLACE ORDER IN NON-TRADING HOURS OF THE MARKET WHEN MARKET IS CLOSED?
2)I'm a position trader.I'Ve on line demat account of icici direct.Can i place delivery buy/sell order beyond working hours of market?If so how?
the gaps r due 2 overnigft fear or euphoria before the mkt re-opens again......the in between time news or event which is captured in the nxt opening....
in monthly charts v rarely find gaps as it will capture the time between the mkt closing of the month & the opening for the fresh month....just a single session
in monthly charts v rarely find gaps as it will capture the time between the mkt closing of the month & the opening for the fresh month....just a single session
1)I'm a position trader.I'Ve on line demat account of icici direct.Can i place delivery buy/sell order beyond working hours of market?If so how?
well, you can place the order before the market opens, it's called AMO (after market order).
icicidirect has the feature of AMO. look for the option. placing order usually at late night or early morning will be good.
AMOs are not good, though they give your the flexibility of buying/selling. you'll end up paying more or getting less on your sell transaction.
Good time to buy delivery shares? around 3:20pm to 3:30pm, just before the market closes.
icicidirect has the feature of AMO. look for the option. placing order usually at late night or early morning will be good.
AMOs are not good, though they give your the flexibility of buying/selling. you'll end up paying more or getting less on your sell transaction.
Good time to buy delivery shares? around 3:20pm to 3:30pm, just before the market closes.
sorry, i forgot that AMO is automatically done by icicidirect. please see: http://www.traderji.com/equities/17434-after-market-order.html#post143907
I just remembered something that I read a few days back in Ashwani Gujral's books. It may not be entirely related to this thread.
So, if I can relate properly, more the novice interest in a scrip, higher it will open. We all expect novice traders to commit some mistakes. Ex: Buy shares when there is a news about a company. Atleast I did this when I was very novice. Thus, greater the novices, higher we can expect the opening. Also, I assume that in a bull market, more no. of novice are attracted to the scrip, thus greatly increasing the interest in it and propelling its open price.
The closing price is determined by professionals like large institutions, MF schemes which buy in very large quantities. However, to avoid abrupt price fluctuations, they buy in small lots(accumulation phase). The accumulation phase is a precursor to mark up phase where the share price goes on increases.
Institutions usually do not buy on such news, hence institutional interest in the scrip remains more or less the same. Hence, even tough opening price gaps significantly, closing price may not.
- Opening price is controlled by amateur or novice traders
- High price is controlled by bulls
- Low price is controlled by bears
- Close price is controlled by professionals like institutions
So, if I can relate properly, more the novice interest in a scrip, higher it will open. We all expect novice traders to commit some mistakes. Ex: Buy shares when there is a news about a company. Atleast I did this when I was very novice. Thus, greater the novices, higher we can expect the opening. Also, I assume that in a bull market, more no. of novice are attracted to the scrip, thus greatly increasing the interest in it and propelling its open price.
The closing price is determined by professionals like large institutions, MF schemes which buy in very large quantities. However, to avoid abrupt price fluctuations, they buy in small lots(accumulation phase). The accumulation phase is a precursor to mark up phase where the share price goes on increases.
Institutions usually do not buy on such news, hence institutional interest in the scrip remains more or less the same. Hence, even tough opening price gaps significantly, closing price may not.
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