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YES
But, the specialist needs rotation in the price of the stock or future to mark
up thier inventory and they got very little during that first week. Now I
agree that they can not take all trades but my guess is that alot of specialists
had a huge inventory at or near the bottom and have been well rewarded
since.
<SPAN
class=060163923-13102001>
When I
read Dorothy's comment last night it struck me that the specialist were my
"invisible hand" they are now getting the rotation that they need to make money.
I also agree that they can not move the market by themselves one at a time but
when they all are in the boat togather I believe they can add the sparks where
needed to leverage thier influence. As I discussed before I felt that the
futures were pushing the equities. Now I know the futures will almost always
lead the equities but it is normally based on some improving aspect of the
undering equity which I did not see this last week or 10 days. This week it
seemed to me that the futures were moving for the sake of the futures with
little regard to the equities. Just my feelings.....and if this is the case then
that inventory is likely almost gone and now they may need rotation in the other
direction which may lead to a retest to start the cycle all
over.
<FONT face=Tahoma
size=2>-----Original Message-----From: Ira Tunik
[mailto:irat@xxxxxxxxx]Sent: Saturday, October 13, 2001 2:03
AMTo: realtraders@xxxxxxxxxxxxxxxSubject: Re: [RT] HEAVY
BLK ACTIVITY ON QQQ'S YESTERDAY... I may have posted this
yesterday..There seems to be this belief that the
specialist is all knowing and all seeing and can tell better then anyone else
where the market is going. There also seems to be the assumption that
the specialist can take in hundreds of thousands of shares with an
inexhaustible bank. These are false assumptions. The edge that the
specialist has is that he has the book and knows where the orders are.
He doesn't know that they will still be there if price gets to those levels
because the order can be canceled. He is supposed to make an orderly
market, when he can. When not, there are gaps down or up, or a halt in
trading until orders can be matched. The other edge that the specialist
has is that he can participate in large block trades. Say a mutual fund
wants to sell 500,000 shares of xxx stock. The existing price is
$55. He can search for the other side of that trade or he can look down
in his book, add up all the shares to buy below the current price until they
add up to the 500,000 shares for sale. He may tell the seller that he
wants to participate in the buy up to 35,000 shares. This is agreed
upon. The specialist then sells the first 35,000 shares in his book and
takes all of the shares for sale up to the 500,000. The cross might be
at $54 or at $49 which price has been agreed upon before hand. But there will
be a orderly march down there as the specialist knocks down the shares he is
about to buy back. I doubt that any specialist is going to take in a
couple million shares of QQQ in the hopes of a rally because he can't move the
market for more then a couple of minutes when the market is very thin.
Especially in the QQQ which are used buy every hedge fund or hedger as a
vehicle. There was one exception that I heard of. That was in 1987
when many of the specialists were broke or negative and the government told
the banks to offer the specialists unlimited credit so that they could
stabilize the markets. It didn't help a certain bank in Chicago that
went belly up because of all those very smart market makers that went
broke. Remember that the market makers in stocks or options and
the specialists are taking the other side of everyone else's trade. They
are not instigating any of the trades. They are accepting bids or
offers and accommodating the public when there is no one else there.
Dorothy Carter wrote:
There is no
way to know for 100% unless you can see specialist book.. but when I see
this many blks clustered together it feels to me like a major mutual fund
buying and the specialist selling to them... It doesn't look to me timing
wise after a big upmove off of recent lows that we would be seeing a mutual
fund that would be that savy or short term oriented to sell a long position
here... so that tells me it is most probably specialist selling what he had
to buy on way down or setting up shorts that they ride down
again.... There is obviously two sides to each blk and the specialist is
the smart $$$So if I'm
reading this correctly.... it is distribution by specialists who had to buy
on way down starting on Sept 17th and lower.. also these levels are
back to Apr lows.. so if some institution bot at Apr lows rode them up then
got caught on way down would have sold Sept 10th or Sept 17th and the
specialist most probably took other side... I can tell you that
there were even more blks on QQQs, SPY, MDY etc on Sept 17 -19th... so I'd
guess as market improved and got everyone bulled up that specialilst is
unloading...
<BLOCKQUOTE
style="BORDER-LEFT: #000000 2px solid; MARGIN-LEFT: 5px; MARGIN-RIGHT: 0px; PADDING-LEFT: 5px; PADDING-RIGHT: 0px">
----- Original Message -----
<DIV
style="BACKGROUND: #e4e4e4; FONT: 10pt arial; font-color: black">From:
Ira Tunik
To: <A
href="mailto:realtraders@xxxxxxxxxxxxxxx";
title=realtraders@xxxxxxxxxxxxxxx>realtraders@xxxxxxxxxxxxxxx
Sent: Friday, October 12, 2001 5:18
PM
Subject: Re: [RT] HEAVY BLK ACTIVITY
ON QQQ'S YESTERDAY... I may have posted this yesterday.. Looks
like short covering to me. How much of took place on up ticks and
how much on down ticks. that would tell a different story.
Dorothy Carter wrote:
BELOW SEE SERIES OF BLOCK TRADES
ON QQQs yesterday.... THIS IS HEAVY.. NOT NORMALBLK
ACTIVITY....opn QQQs <FONT
size=-1>--------------------------------------------------------------------------------
7:48 RT U.S. stocks seen
little changed to slightly higher at open <FONT
face=Quotrone> 10/11 DJ DJ NASDAQ-100 Index (QQQ)
Block: 400,000 Shrs At 34.36 <FONT
size=-1> 10/11 DJ PRESS RELEASE: AMEX To Trade Nasdaq-100 Index
Options 10/11
DJ =DJ Options Report: Amex To Trade Nasdaq Index Options
10/11 DJ DJ NASDAQ-100 Index
(QQQ) Block: 1,000,000 Shrs At 34.16 <FONT
face=Quotrone> 10/11 DJ DJ NASDAQ-100 Index (QQQ)
Block: 466,000 Shrs At 34.30 <FONT
size=-1> 10/11 DJ DJ NASDAQ-100 Index (QQQ) Block: 350,000 Shrs At
34.35 10/11 DJ
DJ MARKET TALK: Nothing Good Lasts Forever <FONT
face=Quotrone> 10/11 DJ DJ NASDAQ-100 Index (QQQ)
Block: 750,000 Shrs At 34.48 <FONT
size=-1> 10/11 DJ DJ NASDAQ-100 Index (QQQ) Block: 350,000 Shrs At
33.85 10/11 DJ
DJ NASDAQ-100 Index (QQQ) Block: 644,800 Shrs At 33.77
10/11 DJ DJ NASDAQ-100 Index
(QQQ) Block: 300,000 Shrs At 33.87 <FONT
face=Quotrone> 10/11 DJ DJ NASDAQ-100 Index (QQQ)
Block: 300,000 Shrs At 33.97 <FONT
size=-1> 10/11 DJ DJ NASDAQ-100 Index (QQQ) Block: 375,000 Shrs At
34.15 10/11 DJ
DJ NASDAQ-100 Index (QQQ) Block: 775,000 Shrs At 34.14
10/11 DJ DJ NASDAQ-100 Index
(QQQ) Block: 300,000 Shrs At 33.90 <FONT
face=Quotrone> 10/11 DJ DJ NASDAQ-100 Index (QQQ)
Block: 600,000 Shrs At 33.95 <FONT
size=-1> 10/11 DJ DJ NASDAQ-100 Index (QQQ) Block: 300,000 Shrs At
33.97 10/11 DJ
DJ NASDAQ-100 Index (QQQ) Block: 300,000 Shrs At 33.69
10/11 DJ DJ NASDAQ-100 Index
(QQQ) Block: 400,000 Shrs At 33.80 <FONT
face=Quotrone> 10/11 DJ DJ NASDAQ-100 Index (QQQ)
Block: 527,900 Shrs At 33.20 <FONT
size=-1> 10/10 RT U.S. stocks press higher on upbeat
forecasts
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