If today strikes you as familiar it should be. It is almost a carbon copy of last Monday. [Jun 14, 2010: Premarket Action Priceless - Regular Session? Not so Much] Back then we gapped up 0.8% on news I still cannot find, rallied, slowed down, filled the gap and eventually ended in the red. So in reality the market was down about 1.1% during the 'real session" and up 0.8% in the premarket (I include the first 5 minutes of the session as 'premarket' for this exercise since those prices reflect the doings of the premarket).
Today? An even bigger gap up but at least there is some sort of vague excuse with the Chinese currency. But at this moment the premarket/first 5 minutes showed a gain of well over 1% and the rest of the session is once again deep in the red. On the plus side, just as we did last Monday we filled the gap quickly!
Let us thank the premarket because if not for that we would have missed 0.8% last Monday, 0.8% last Tuesday and well over 1% today. Heck that's about 3% lower and we'd be stuck under the 200 day moving average - unacceptable.
On the longer term time frame all these days we open up +0.3, 0.4% (which have been countless days over the past 15 months) you can lose 0.3%, 0.4% during normal hours and still end up flat. It adds up over a year+... a lot of daily losses were erased via premarket magic. Do we have countless days of -0.3%, -0.4%? Hardly ever - either we gap down big or open sideways or up... for some odd reason.
I have no idea where we end up today, could be at the highs of the days or down 2% - but for those who do not watch the market closely day after day I keep harping on this because the premarket has been the cause of so much of this epic rally from March 2009. You can see a microcosm the past week alone. (please note you cannot just take the closing price of the previous session and then the opening print of the next day to reflect the gains created by premarket - it takes a few minutes of real market trading for all these stock prices to surge en masse and be fully reflected)
Go Team Premarket.
(on a side note we're at 1120, so dip buyers should step in here in anticipation of free money in tomorrow's premarket) ;)
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