Good morning Alan and Richard,
I have been watching the behaviour of stocks within the opening half hour of the markets for some months, and the management of stocks by those wealthy shadows from the underworld - the institutional Market Makers (MMs). In so doing, I have become alarmed at a thought which is plaguing me - a thought which flies in the face of everything new traders have been taught; indeed against our most basic instincts, and your views on this 'thought' would be most welcome.
Undoubtedly, to enter a trade in the first half hour is a most attractive and alluring temptation as huge movements are effected in either direction. The canny stay out of the markets until at least half an hour has elapsed. However, every morning, thousands and thousands of traders line up on the battle field, holding their stop and limit orders high in the air for all to see. When the battle commences, the MMs, amid fake, counter fake and false trend settings, take out most of the opposing army of private traders as spikes rain down on them from above and below. At noon the MMs retire to the Doldrums (a NY diner?) relatively unscathed, leaving behind them the usual daily carnage.
My thought is this: If the more courageous private traders were to trade the first half hour without stops and limit orders thus revealing little, if any, of their battle plan, the efforts of the MMs to fell them on every occasion would be frustrated. Stupid? probably. Suicidal? possibly. Profitable? if you predict the opening trend accurately, almost certainly. Scary? terrifying!
I know that there are private traders who trade the open in this way, having taken a view on the direction of the opening trend and trading both that trend and the reversal (if it comes!) They do so with one finger on the buzzer, a telephone by their side and at least one change of underclothing. However, the arrows of the MMs would fly over their heads and they would remain in the battle for the potentially large profits to be had at the open. There again, how many in the past have marched forward to the sweet music of rising momentum only to step on a land-mine just before exiting the battle?
Any views?
Best wishes,
Sean
...doubt i'll beat yesterdays 150odd cents though 
