How the Pros Handle After Hours Trading

Trading Strategy September 23rd, 2015 2min to read

View Larger Image

It is often assumed that the professional traders will buy and sell in the pre-market and after-hours trading sessions because they want to be able to react quickly to news announcements that may occur when the regular market is closed. But is there really an advantage to trading during off hours?

Stock prices change – sometimes moving quite rapidly, forming price gaps – for a given stock when the company’s management team, stock analysts, and others release new information. These gaps are particularly dramatic during earnings season when companies are disclosing their financial performance for the previous quarter and their outlook for the coming year.

Sometimes these important news releases occur during regular market hours; but, most of the time important news releases are issued during pre-market and after-hours trading sessions.

New traders often assume that since price gaps most commonly occur between one trading day’s close price and the next trading day’s open price that they will be able to buy, or sell, the stock somewhere in the middle of the gap either after the market closes or before the market opens the next trading day. However, that is usually not the case.

Unfortunately, there are very few things that provide a true ‘edge’ for short term traders. Trading during off hours can provide a slight edge from time to time but it also comes with some potential risks.

One thing that can give traders an edge is anticipating big moves before they happen and being on the right side of trends. With VantagePoint, you can often catch the overnight gaps in stocks and other assets because the software gives advanced warning of changes in market directions.

VantagePoint uses neural network technology to analyze the data to find the twenty-five related markets that most affect prices of your target market, quantifies the degree of influence these related markets have on your market and then uses that information to forecast trend direction, market strength and daily trading ranges in a simple-to-read chart and report. You have a complete forecast for the market you are trading in less than five minutes the night before so you can be prepared to profit from the after-hours trading sessions.

Recent News

Trading Strategy January 9th, 2025 19min to read

Selling Put Options Unveiled: The Ultimate Guide to Financial Control in Trading

what often eludes the typical investor is the perspective that selling options, much like selling price insurance, can indeed be a remarkably profitable venture. This is where the philosophy diverges significantly. The greatest money managers and traders, the Buffetts, the Dalios, the Soros and their ilk, understand that selling Options is akin to assuming the role of the insurer rather than the insured.

Trading Strategy December 19th, 2024 17min to read

Why The Fed Rate Cuts Aren’t Calming the Markets Anymore?

I'm no fan of the Federal Reserve. After three decades of watching their every move with a critical eye, I've come to a stark conclusion: it's time to dismantle this institution. For 111 years, the Federal Reserve has been at the helm of America's economic ship, and frankly, the results have been less than stellar. It's a bold statement, but one grounded in a deep-seated belief that markets should be free — truly free. This means interest rates and money supply should be dictated by market forces, not a central body.