Significance of "preopen"?

H

heech

Hi there,

Can someone speak to me about the "significance" of preopen ask/bid prices? The concept is a little foreign to me.

Nothing is actually being transacted, right? These ask/bids (currently 17:45 CST) are being advertised just for the heck of it?

Are these ask/bids actually really meaningful in terms of telling me where the future is going to open at, or is it just "bluffing"?
 
neh...just everyone getting their stuff in and a lot of "bluff" orders on the screen. If you want the true opening indication, call down to the floor...the screen is just fluff for the most part, thats why you'll see a "quoted" bid suddenly pop or drop 2-3 cents in a second as we open up.
 
Back on the CBOT Ag floor, they used to shout out bids/offers before the bell. No trades, just indicating where brokers with paper would open the market. Harkens back to that I believe.
 
Quote from fortunatti:

Back on the CBOT Ag floor, they used to shout out bids/offers before the bell. No trades, just indicating where brokers with paper would open the market. Harkens back to that I believe.
More...

Did you trade in the grain pits fortun??
 
I wish --- !

Traded for a crusher but spent time there as a "temp clerk."

Was able to write up my orders and hand it to the broker myself. Loads of fun.

Haven't been back since side-by-side started.
 
the pre-open is still quite useful; alot of quant traders use the pre-open to game the open because towards the end of the pre-open session orders become locked in and can be gamed off the open in either the implied spread market or other outright markets.

The pre-open is less useful as the hours become extended; recently CME Group extended overnight session hours to 715AM CST and not long until I believe it will have a eurodollar style trading time if they have their way.
 
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