How to purchase when a stock moves fast

S

smcoder

I was looking at a video about using pre-market data (large gains or losses) to identify interesting stocks and entering when these move beyond identified price levels but here is my question, how do you enter such stocks? These stocks usually move very fast and often in less then a sec after market opening they are already where they will remain for the rest of the day. How do you enter such a stock at the price you want? Posting an order at market price is clearly too risky but then what alternatives exist?

Thanks
smcoder
 
If it's running super fast, then place a limit order higher than the current ask price and hope you get filled. If the stock is at lower price than your limit order at the time it hits the market, you'll get filled at that better price. If the stock goes higher than your limit order by the time your order reaches the market, you can just cancel the order and chalk it up to missing that one but at least you're not getting filled at an unknown price point like you would with a market order.
 
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Can you specify a "limit order" to your broker?

"A limit order is an instruction to either buy or sell when the price reaches a predefined level. For a buy limit order the instruction would be to execute at X price or lower, for a sell limit order it would be to execute at X price or higher. Limit orders are a good way to prevent slippage as they essentially guarantee that a trade will be made according to certain price parameters or not at all. The disadvantage of placing limit orders is that in rapidly moving markets they run the risk of not being filled."
 
If I want to buy a stock only if it gets over a certain price (my confirmation level) and I post an order with a buy limit higher than the current stock price anyone will be more than happy to sell to me immediately but before reaching my confirmation level.

How can you enter a stock with a lighting fast rise of price but only after the stock has reached a certain price (not before) and at the same time not lose the train?
 
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It has limit orders meaning that you can set the bid price but any lower price will close the purchase.

Do limit orders you are talking about allow setting in addition to the bid price also an additional price that defines when the order lands in the book?
 
Orders will be executed electronically faster than you can enter them manually or open the position manually, but there isn't a way as far as I know that you can set a "pending" order conditional on something else.
 
smcoder said:
I was looking at a video about using pre-market data (large gains or losses) to identify interesting stocks and entering when these move beyond identified price levels but here is my question, how do you enter such stocks? These stocks usually move very fast and often in less then a sec after market opening they are already where they will remain for the rest of the day. How do you enter such a stock at the price you want? Posting an order at market price is clearly too risky but then what alternatives exist?

Thanks
smcoder
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If I understand your question, and I'm not sure I do, you can set a stop or stop limit order to buy when the price is triggered. Good for breakouts.
 
smcoder said:
These stocks usually move very fast and often in less then a sec after market opening they are already where they will remain for the rest of the day.
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if that is true then u do not get involved in those stocks
 
I was probably not very clear in explaining my intent. My need is to enter a stock when this will rise in a sec at market opening but to enter
1) only then the price reaches a certain level, not before
2) not lose the fast trend

To my knowledge there is no way create an order that will go in the book only when a stock reaches a given price and on the other hand any limit order will immediately match lower ask prices which I don't want.

Stop limits are for selling.
 
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