CNR, the Playhouse

Yesterday afternoon I scanned through about 400 different stock charts off of my Dailygraphs program looking for "bounce situations". I did not care about anything in regards to the company itself at this point and I was just looking for possible places to make a few pennies on my last $3,150 I could trade (for some reason Ameritrade won't let you trade cash from a last trade until it is full processed or something). I ended up with about 30 stocks which I narrowed down to 10 then finally narrowed down to 2: ALTI and CNR. ALTI was in a big down trend and I was not interested to play it today but more so in the next few days (if Ameritrade will even let me). CNR was also in a long term downtrend but more interestingly sitting right on its 200-day moving average. Support point? I was not sure so I decided to track it and try and get a steal on some shares this morning.

I stated that to let you know what interestingly enough happened this morning which is not only a rare situation to actually see with your own eyes but also quite fun for 9:30 AM. I am going to try my best to explain this but take note that I can 1. see every trade processed, what price it was processed at, and time. 2. I can see how many shares are for the most part available at each price (at the Bid and Ask). 3. I can see who traded what (the institution or house, the Exchange, and if it was by some random joe like me then it would state "Nasdaq" or "Nasdaq NM" next to it.

So where does this leave me? In a good spot perched off a distant clliff ready to swoop in for an easy kill, and that is what I did (hopefully). The stock closed at $1.00 even yesterday and in the morning hours of trade (this is the pre-market from 8:00 - 9:30) there was ALOT of volume. CNR averages about 2.4 million shares a day and before the stock even opened at 9:30 the price was at in the low $.90s ( which is why you would see a gap down today or on any stock for that matter on a chart) on well over 1 million shares. But who was selling all of these shares? Everyone? No, just 1 Exchange represented almost all if not all of the volume. Then, the stock opens, kinda sits for a few minutes, then major downtrend starts. We are talking 10s of thousands of shares just being sold heavily on one Exchange, AMEX.

To make a long story short, AMEX drives the stock price down to $.86, $.85. The bid eventually hits $.84 and what do I see? over 500,000 ready to be bought at $.84 by guess who, AMEX. What does this tell me? This tells me that AMEX is now done selling and wants to get back in at a steal price. So, I swoop in and snag as many shares as my $3,100 left in my account will let me buy and end up getting 2,000 at $.85 and 1,600 at $.86 (both bought at 10:11:09 AM). Now, hopefully AMEX is done and doesn't pull a fast one on us and we see $.84 as the bottom for this trend. Every penny the stock goes either way is $36 (for the most part) out or into my pocket. Only time will tell, but either way it's just another morning in a daytraders world. Now, to get some breakfast...