CCP1200

Everyone always thinks that if they can get some type of statistical edge on the number of days that we get certain day types that he will have a trading edge. it would be better to come to an understanding about the forces that cause the days to look the way that they do... namely the order flow that changes the structures. And to be more precise, to see the imbalance in the order flow because that is what caused the price movement.

We used to wait for the initial balance to take place before we considered trading the order flow imbalance out of it... so that would mean that you would wait an hour... but the entire subject of initial balance is not invalid because of the 24 hour markets.... when the market only traded in chicago, all the overnight orders were in the hands of the pit brokers and they would open the market to their advantage to fill the orders that they held... and it would take the initial balance to work out where the value in the market really was and any price movement out of that area was caused by order flows that came in after the opening... so we were really blind at the opening when you were looking for the condition of the market from the overnight orders... now we can see them because they traded and we can evaluate the exact imbalance that is offered to us on the opening...