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Strategies & Market Trends : DAYTRADING Fundamentals -- Ignore unavailable to you. Want to Upgrade?

To: ig who wrote (5264)	11/8/1999 7:51:00 AM
From: TFF	Respond to of 18137

>>>Traders often say that a large block below the bid is a bullish sign. If someone can explain that to me, I would be grateful. Often when I am watching a stock in an uptrend the pace of trading slows down at a particular level. If there is an increase in the size of trades during this time I will take this as an indicator that resistance has been met. Often this will mean that a large order has been filled and is being crossed to an institution before the market makers pullback off their bids. I see the same thing happen on downtrends, but in this case the market makers are buying from the institution.

To: ig who wrote (5264)	11/8/1999 7:11:00 PM
From: Threei	Respond to of 18137

Does a large block printing below the bid mean the same thing as a large block at the bid? Traders often say that a large block below the bid is a bullish sign. If someone can explain that to me, I would be grateful. The most frequent scenario(oversimplified for demonstration purpose) is: MM has large order to sell, let's say 100K shares. He sells 100 x 1K shares at 20, when market is 19 7/8 x 20. Doing this he takes short position 100K shares. When he is done, he transfers 100K from client's account to his own, covering his short and taking out client's long position, and he prints it as single block at 19 3/4, pocketing 1/4 on whole position. After this he takes the selling pressure off and stock upticks assuming the buying interest is still in place. Traders call it "block cleared" or "closed" and consider bullish sign (often correct, as long as there were not too many other factors influencing stock price). Hope this helps, Vadym