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oh NORMAN.... BUY THE SIT AT 12000 SOLD IT AT 8000000
YOU ARE REALLY A GOOD BUSINESS MAN.........
SINCE THEN YOU BOUGHT 1000000000 mICROSOFT
AND NOW YOU ARE A VERY RICH MAN!!!!!
Ä ......WHAT ELSE YOU HAVE DONE ?
----- Original Message -----
From: Norman E. Phair <ericrogers@xxxxxxxxxxxxx>
To: RealTraders Discussion Group <realtraders@xxxxxxxxxxxxxx>
Sent: Freitag, 7. Mai 1999 18:08
Subject: Re: Stops/Michael
>Gary:
>
>Your skepticism of most of the comments about the floor traders running
>stops is well founded. I have so far been able to keep
>my little fingers from spouting off about this subject which will make a
>lot of people here happy, because when I start I have a problem
>stopping. I came close to buying a seat on the Merk. in 1968, last sale
>at the time was $12,500. A few years ago it hit over $800,000. I hope
>this is the only stupid thing I admit to on here. In 1984 I went back
>to NY from CA and considered buying a seat on the NY Futures Exchange.
>I decided against that for weather reasons. This is all I intend to say
>at this time
>concerning this subject.
>
>Norman E.
>
>Gary Fritz wrote:
>
>> Ira wrote:
>> > It is no secret where the stops are. YOu can look at any chart
>> > and see. They also get the breakout traders. they take the market
>> > to a new high and then slam it. You can do anything you want on or
>> > off of the floor if you know how.
>>
>> That's all fairly common knowledge, but I want to ask a really basic
>> and probably naive question:
>>
>> **HOW** do the floor traders "take the market" anywhere?
>>
>> It seems to me, from a simplistic point of view, that at any moment
>> there is a "fair price" for any commodity. That's the agreed-upon
>> price arrived at by buyers and sellers in the market at that moment.
>> How does the floor trader disrupt that balance and move the price
>> away from its "real" fair price, then "slam it" back again?
>>
>> I assume that the stop-runner moves the price by e.g. bidding well
>> above the current price with a small number of contracts. Then, once
>> the market moves up to his bid and gets to the area where all the buy
>> stops are sitting, he sells aggressively into those stops. The
>> selling pressure (and the sudden lack of artificially-high bids) then
>> moves the market back to its "real" price. Any losses that the
>> runner suffers on his bids are more than made up by the profits on
>> his larger sells.
>>
>> Is that about right?
>>
>> What's always confused me about this scenario is WHY the market would
>> follow the stop-runner's bids like obedient sheep. Is the market
>> really so easy to manipulate (at least during the thin periods that I
>> assume are the prime stop-running times) that a few contracts bid
>> above the current price will move the whole shebang? Wouldn't the
>> runner have to keep bidding and bidding and bidding above the market,
>> or else the previous supply/demand forces would come into play and
>> snap the market back to its former equilibrium? (Or are the runner's
>> few contracts enough to *change* that equilibrium??) How does the
>> runner keep the market moving to his desired target -- do the rest of
>> the floor traders smell blood too, and help him move it?
>>
>> Lastly, Ira, you say you can do it on or off the floor. I'm having a
>> little trouble imagining how a single small (or even fairly large)
>> off-floor trader could initiate a market move like that, unless he's
>> able to spark the same blood-lust on the floor that the on-floor
>> runner was relying on. Is that really do-able, or just theoretically
>> possible? Or are you saying that the smart off-floor trader will
>> WATCH for one of these stop-running moves, and sell when the price
>> reaches the obvious stop-resting point, just like the runner did?
>>
>> Thanks,
>> Gary
>
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