What Drives After-Hours Trading?

J

JRL

Hi Guys,

I've been following a stock this week (MGM), and there seems to consistently be huge movements in after-hours trading. Just happened now, 10 minutes after the day's closing, the price gapped up from $10.37 - $10.81.

All I've heard about after-hours stuff is that it's typically only played by seasoned pros. What exactly drives all the price movements? Especially in MGM, this week, the pattern appears to be big gaps up when the market closes, maybe big gaps up the following morning, but then a big reversal.

What drives the after-hours activity?

EDIT: technicals also appear to be bullish. The MACD line just curved upward slightly, the %K line just crossed over the %D line in a sharp upturn, although the CCI indicator would suggest that it's overbought at $10.81 (+478.36).
 
Quote from mrwoody:

that is probably just a spike because of the big difference within the bid-ask price.
More...

Right, but why the huge difference? What's driving that? The day's trading was relatively flat since about 10 AM.
 
Quote from JRL:

Right, but why the huge difference? What's driving that? The day's trading was relatively flat since about 10 AM.
More...

it is still flat... those numbers are fake. The point is that if you buy after hour with a market order, you are probably going to pay much more than what you were expecting. Lots of people do that (probably amateurs). And then it looks like the price of the stock changed... but if you wait few hours you will see it goes back to normal.
 
Quote from JRL:

Right, but why the huge difference? What's driving that? The day's trading was relatively flat since about 10 AM.
More...

All after hours trades in mid $10.30's with one at $10.72.
 
Quote from mrwoody:


as you can see there is no much volume...
just people wasting money.
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No kidding - looks like someone dropped over $7K paying $10.72 for it - flat for the rest of the after-hours'.

Thanks.
 
Quote from JRL:

No kidding - looks like someone dropped over $7K paying $10.72 for it - flat for the rest of the after-hours'.

Thanks.
More...

that is nothing... if you follow aapl, you see that sometimes people easily waste lots of money investing >$200K after hour.
 
Quote from mrwoody:

it is still flat... those numbers are fake. The point is that if you buy after hour with a market order, you are probably going to pay much more than what you were expecting. Lots of people do that (probably amateurs). And then it looks like the price of the stock changed... but if you wait few hours you will see it goes back to normal.
More...

Yup. And that's exactly what's happened with MGM all week. Very volatile in the after-hours and right after the opening bell.

Thanks - I was just wondering if there were any other causes behind after-hours price gaps because they've been happening with frequency over at MGM this week.
 
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