The Spikes and Gaps in market

T

traderwald

Hi guys,

How big are the gaps and spikes in the after hours trading ? If we have an overnight position open in either Opts or Futs, then how big can the spike be ?

I was looking at the paper account where I opened a few Opts and Futs positions and sometimes the position would show for example:

a $12.00 Opt would trade at $2 or $3 (last traded value) during the market close and would be again be $11.50 or so in a few seconds. ES would be $2995 during trading and in after market close I saw Last traded value of $2930 for a few seconds before the value comes close to $2995 again.

questions are :

1. is the above what they call as Gap or Spike ?

2. Are such big gaps possible ? (and are they regular)

3. did the trade actually happen at those values ?

I am mainly asking based on other threads where I am advised on of the things to be look out for in opts trading is spike.
 
etrades said:
How big are the gaps and spikes in the after hours trading ?
2. Are such big gaps possible ? (and are they regular)

3. did the trade actually happen at those values ?
More...

Perhaps half of the largest candle moves for any index occurred to a larger degree outside of RTH. Last night, the RTH drop continued til 21:00hrs ET ?? before the turn/rise to current levels. China's yuan devaluation (August 2015) hit outside of RTH. The U.S. 2016 election saw a plummet of massive volume down hundreds of S&P points, only to see it turn at 3am, and end the day positive by 1% or 2%.

Roughly, "massive moves" might have happened every six months over the past decade, and perhaps every quarter in the last 2 years. Ballpark. -ish.
 
etrades said:
Hi guys,

How big are the gaps and spikes in the after hours trading ? If we have an overnight position open in either Opts or Futs, then how big can the spike be ?

I was looking at the paper account where I opened a few Opts and Futs positions and sometimes the position would show for example:

a $12.00 Opt would trade at $2 or $3 (last traded value) during the market close and would be again be $11.50 or so in a few seconds. ES would be $2995 during trading and in after market close I saw Last traded value of $2930 for a few seconds before the value comes close to $2995 again.

questions are :

1. is the above what they call as Gap or Spike ?

2. Are such big gaps possible ? (and are they regular)

3. did the trade actually happen at those values ?

I am mainly asking based on other threads where I am advised on of the things to be look out for in opts trading is spike.
More...
%%
Plenty big in after/irregular hours, real regular. Mostly yes; i seldom trade it or even look @ it, or hunt wild kangaroos. I have shot running deer/jumping deer but prefer to slow squeeeeeeezze the trigger when they are feeding:caution::caution:, :caution::caution::caution::caution::caution::caution::caution::caution:
 
It's not how big it is but how much it's moving against you.

If you're long the option, on the right side of the move and you have the margin to support the trade, bear in mind that you can lock in gains by taking the opposing position in the after market and unwind in the AM. A classic example of this was election eve in 2016 when the DJIA futures were down over 1,000 points and most of it had been recovered by early the next morning.
 
Thank you for the replies guys.

I guess that would mean the numbers I gave in the initial post are indeed gaps or spikes !!

This means that having a short position opts far out of money like maybe 150 points out on Es may still become itm in after hours trading is that correct ?
 
Last edited:
etrades said:
Thank you for the replies guys.

I guess that would mean the numbers I gave in the initial post are indeed gaps or spikes !!

This means that having a short position opts far out of money like maybe 150 points out on Es may still become itm in after hours trading is that correct ?
More...


Hi guys,

Please let me know on the above question.
 
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