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Non-Tech : Meet Gene, a NASDAQ Market Maker
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To: Mark Z who wrote (30)7/26/2000 9:33:54 PM
From: gene_the_mm  Read Replies (1) of 1426
 
REGARDING MOC ORDERS ON THE NYSE...

While you all know my expertise is the NASDAQ market, I can share with you something a veteran told me about and made some good money doing.

The 'run-up' you saw at about 3:30 to 4:00 was probably caused by an announcement on the tape of a 'buy imbalance'. What this usually is (but not always and some you NYSE guys please feel free to correct me) would be the specialist halting the stock to try to get some help in finding the other side of the imbalance (HOWEVER, I understand that they can announce MOC buy imbalances WITHOUT halting as well...not sure though). In any case, what might have been happening is the SCH specialist was announcing a buy imbalance for MOC orders. This is public information and will hit the tape. I understand the reason for this is, supposedly, to attract sellers to also sell MOC.

The veteran I used to know told me to watch the average volume of the stock and see how big the imbalance was. If the imbalance was a decent percentage of daily volume, he would start to buy immediately after the MOC imbalance was posted. The idea was to then turn and sell INTO the imbalance right at the close by putting in MOC SELL orders. I may have tried this once or twice and didn't make much money doing it. However, he claimed with the right circumstances it was easy money.

That is all I can tell you about what you were probably seeing. It's possible also that institutions and customers had to simply FINISH what they were doing in the last half hour and the business in SCH just picked up a bit.

Hope that helps.

All the best,

-- Gene
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