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Jeremy Frommer, CEO of Hedge Fund LIVE Jeremy Frommer has 20 years of industry experience and is currently responsible for general management and leadership of the General Partner. Previously, Mr. Frommer was a Managing Director and Head of the Global Prime Services Group (“GPS”) at RBC... More
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  • Overnight Trading – The Battle Begins  0 comments
    Apr 15, 2011 10:24 AM

    Trading through the night. A new one for me. Like sky diving (which I have never done), or bungee jumping (another I have never done). Tonight felt like the night. Alone in my thoughts. No voices to distract me. Quiet. Pure trading. Instinct. It is 12:36am. I am here. Yet I am not. It is surreal. Lifted at 1308.75, I will bid ¼. What keeps the market up after negative GS news? More importantly, how many other lunatics like me are still trading right now? Oil is flat. I have offered some at 1309. A pack of smokes and tea. A traders dream. Taken at 1309. I will bid 1308.5. Trades at 1309.25. Can they go to new highs? I am intrigued. The trading floor is dark. The light from my MAC shines on me as I listen to some strange alternative music on my iTunes. Dow futures are up 8. The dollar is dropping. Asian markets are flat. I wonder how long I can stay up and stare at the screens. It is both a high like a crack addict, and a depressing sight, like a tortured soul on one last stand. Lifted at 1309. Nearing the highs. Fear sets in. The market is 50 cents wide. I don’t remember the last time I saw that in the futures. Perhaps if I was up at 1 am last night I might have had the same opportunity. Offered at 1309. Senator Levin said Deutsche bank is in trouble! What will the Dax do? The Russell futures just went positive. More fear. They are 09 1/4bid. I am at ½. Why? What a bad close, only to see them rally overnight. NASDAQs are flat. Covered 36 at 1308, average short on 36 1308.42. Bathroom break. I check in on our hits to our site, 100 people in the first half hour of the day. Where are they? Why us?

     

    “Battle not with monsters lest you become one” – Nietzsche

     

    I have become one. It is important to understand the beast you battle. What better way then to become one? It is 1am. I wonder where Goldman Sachs will open. Will executives be accused of perjury? I am offered at 1309.5 and it feels like I will be taken. My nerves are on edge. I am still boggled at how many of us stare at the screens all night. It is a dark world. It reminds me of when Spartacus was relegated to do battle in the bowls of hell. Live or die. No rules. No tears. Just life. Or death. They begin to take the offers at 1309.5, yet a strange calm comes over me. I am taken at 1309.5. I will bid 1309. Futures are at the high of the overnight session. I can feel the wind rush by me as I fall from the plane I dove from. A new high is made at 1310. This was a big level of resistance during the day session. I am tired but I do not desire sleep. I desire the thrill of the battle. There is one contract bid for at 1309.75, but no one will hit it.

     

    “To conquer oneself is a greater victory than to conquer thousands in battle” – Buddha

     

    I have a long way to go.

    I love the silence of the trading floor at 1:10 am.

    They threaten the highs again. They are picking away at 1310. I definitely shorted prematurely, but this battle has just begun. The battle wages at 1009 ¾. Had the Goldman news come out at 3:45 today, this would be a different night. Timing is everything. I am sure my partners think I have lost my mind. But they are wrong. I am in my element. Against the odds, in a battle I have never lived though.

    30 seconds between trades feels like an eternity. It is a pause in the middle of a firefight. Someone please fire a shot.

     

    “Be kind, for everyone you meet is fighting a harder battle” – Plato

     

    Plato is correct. Mine is but a tiny battle in the entire scheme of other battles that are fought every day. But it is my battle, and I cherish it. It seems like the buyers are using up a great deal of artillery. It feels like the sellers are luring them in. Russell futures make a new high as the dollar continues to trade down. Oil is quiet. New high in the Russell. New high at 1310.25. New high in Gold futures. Another few ticks and I will accept defeat for now, and cover a batch. New high in Dow futures. Sold 5 at 1310.25, will bid back 1309.75. It’s been quite a while since I saw a downtick. New high in silver futures. It is 1:30, I am tired, but want to battle on. My body aches, no it is more that tingly feeling, when you have crossed beyond your normal comfort zone and are beyond emotions. No down tick, the enemy pushes forward. New highs in silver.  I pity my opponents as I pity myself. It feels like algorithms are pushing it higher, but when will they stop?  NASDAQ futures hit a new high. I have no choice but to fight this battle, I have too much money on the line. All war is fought over ideological issues or financial. The dollar makes new lows breaking 75 support levels. Gold makes new highs. I sold 2 more S&P at 1310.5. Bidding 1310. Not a single pullback. They are relentless in their march forward up over 5 handles from the lows. I have used up my last match. From here on in, it is the stove. Silver hits new highs. It is 1 45am.  Just hit at 1310. My first kill. 50cents on 2 contacts. Luck? Or a change of the tide? New highs gold. Dollar new lows. Fatigue is setting in. It feels like the algos have backed away.

     

     

    “It is impossible to win the race unless you venture to run, impossible to win the victory unless you dare to do battle” – Richard DeVos

     

    I dare.

    Silver and gold make new highs. Nasdaq pulls in a bit more and turns negative. I am hit at 1309.5. Another kill for .75 cents on 5 contracts. I am reinvigorated. Nasdaq down a point. It has become a war of attrition. Oil is up 34cents at 107.45

     

    I feel stronger shorting at 1310.5. Minutes go by without a trade. It feels like an eternity. Staring. Waiting. Another new low on the dollar. Oil at new highs. I definitely feel nauseous. It is like running a marathon. 1 minute and 30 seconds since last trade.

     

    Offering 2 at 13.10.25. I am lifted. I will bid back a point. New highs on gold. It is 2am. Nadsdaq feels heavy, if one can even use that term at 2am. The Nikkei is closing marginally up. Soon Europe will open and all will become clear. Downticks in silver and gold. And just like that, silver makes a new high. I am starting to lose my mind. I think I need to rest. Russells go negative. Another kill I am hit at 1309.25 on 2.

     

    It is 2 15am. I have set my alarm for 1 hour. It is time to rest.

     

    2:30, I cannot fall asleep. It is like being alone in a foxhole, there is nobody to take watch while I get shuteye.

    Silver makes new highs. And the dollar makes new lows by a penny. I feel nauseous.

    I have to bid for some at 1309 as it is a trend line. If we break it, I will back away until 1308. My partners will arrive in the office at 6 am.

     

    “Now if you are going to win any battle, you have to do one thing. You have to make the mind run the body. Never let the body tell the mind what to do. The body will always give up. It is always tired – morning, noon, and night. But the mind is never tired.” – General George S Patton

     

    I am hit at 1309 on the trend line. I will reoffer them at 1310. The dollar marginally upticks as the S&P trades at 1308.75. They seem to tick down as we get closer to civilization awakening. They are through the trend line. They trade at 1308,25. My blood begins to heat up again. They’re now trading at 1308. I have a 1307.75 bid against sales at 1308.8. NASDAQ pulls in 1.75 handles. I can feel the kill upon me. Hit, my first real kill of the night!

     

    It is 3 am. And the dollar is strengthening. Oil has made a complete turn around and is now down 11 cents. It is going lower.  Bidding 1306 for 1. The desk refers to that as a soldier. They are trading actively at 1306.75. The battle is heating up again. It is 3:15. The nausea has become delirium. If they break 1305, they should see 1300. Or perhaps the delirium is really setting in. They bounced off the Bollinger band with a long wick, although my eyes are crusted over, so I could be making that up. The size has increased as Europe awakens. I think I just ashed in my tea. I am reading headlines about further damage to Japan’s nuclear reactors, and Goldman being brought to the DOJ.  I figure I will take a shower at 4am. The trading floor has its own private spa. 1306.5 is vulnerable.

     

    “I firmly believe that any man’s finest hour, the greatest fulfillment of all that he holds dear, is the moment when he has worked his heart out for a good cause and lies exhausted on the field of battle – vitorious” – Vince Lombardi.

     

    I am hit at 1306. Soldier, well spent! Hit at 105.75. They are a half point to breaking new lows in the overnight. it is 3:40am. Size bid for at 1305.5. Here is where the enemy makes its stand. I am bidding 1305 for 5. Bathroom break. False alarm.

     

    It looks like it may take some time for them to break this level. The last time I saw this level was 8 pm yesterday. I will offer my 2 soldiers back out at 1307. Taken at 1307. Next point of resistance looks like 1308, I will offer 5 and bid back at 1306 for my 2 soldiers. Japan’s now saying it will take 3 months to figure out how to solve their nuclear reactor problems. I feel stoned. But without the smell. It is 3:48am . Hit at 1306 on 2.  Reoffering 2 at 1307.25, bidding for 3 at lows of overnight. Russells are feeling weaker. I am feeling weaker. I am starting to hear things on the trading floor, noises from other rooms. It’s a bit unnerving. Headlines crossing about Obama raising taxes. This all cant bode well for the market. 5 minutes to shower. Ticking at 1307. Stocks are starting to populate in my Redi. They are stuck in a range. It is shower time. 4am.

     

    Nothing has changed in 10minutes. Hit at 5 ¾ on 1. Offering at 6 ¾. They are holding that 1305.5 level firmly. That was the second attempt at breaking it. I will not be bidding for it on the third attempt. If I don’t get lifted at 6 ¾ then we are putting in lower high pattern. Taken at 6 ¾. Biddig 1305.5 for 5. Bidding 1306 for 2.  Hit at 06, offering up .75. They are flirting with the lows and I am starting to flirt with imaginary people on the desk. It is 4:30 am. I am starting to talk to myself.  Lifted at 6 ¾. I will bid 6 again for 4. Lifted at 7 ¼. Bidding 6.5 for 2. Bought 1. Things are heating up, I have a terrible headache.

     

    It is 5am , I have sold 68 contracts at 1308.52 and bought 68 at 1306.9 I am no longer tired, I look forward to the day ahead. I expect them to make a new low and break 1305.

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