Since September 25, which is when I believe the bottom was put in the market, the market is up approximatley 80 S&P 500 points. Of those 80 points. only 12.5 points (15.6%) have come during regular trading hours and 67.5 points (84.4%) has come during after-hours trading. Is it now clear where the real action is in this market. This aint your daddy's market any more.
tom you cloak your stupidity in seeming intelligence but alas you are an idiot. You have no idea when "shorts" so called enter and exit trades, you speak as though "shorts" are one homogeneous group that trades in unison. I have knew for you perma-bill longtardling, people with the skill to short successfully aren't herd following retards like "longs", most of whom are mo mo's who enter a trade together and get slaughtered together like cattle running off a cliff.
Thanks Chicken, you are introducing yet another element to the problem, one I brushed on earlier (all the other ways a market participant can be short other than through futures and how they can offset each other).
Options contracts are quite different from futures contracts. No doubt you understand options better than I do, but I do understand the fundamental difference between options and futures: options are not symmetrical, futures are. With options there is a big difference between the writer and buyer of the option. There is no such asymmetry with futures. The buyer and seller are equal but opposite.
So anyway, if I am short one ES per each 500 SPY I'm long, I am neutral (but I still get to collect the dividend on SPY), and I defy anyone to tell from the tape what the hell I'm up to. Same applies when the bigz are doing this. (Of course, if I do this at a single brokerage, the brokerage knows and can use that information as they see fit, but the information is not discernible from the tape.)
But my "argument" with Tom is more fundamental than that, and I think we mostly cleared it up. He is saying he is computing net short/net long for ES by itself, apparently from the tape, just by netting up volume and down volume. I say what he's calculating is something else, that in the aggregate there is no net long or net short for a given futures contract.
Gotta run. I hope the sky isn't actually falling, Chicken Little Man.
I think an understanding of option/contract may be the answer you're looking for. The MM's goal is to be Delta neutral. To do so, they can buy or sell options and stock to achieve that goal.
Consider this example, if at the end of the day a MM has 10 puts and 4 calls on a position - they get delta neutral by buying 1400 shares of the underlying.
My explanation is pretty simplistic, but it helps to understand that a MM doesn't see any difference between a call and a put. To them, "a put is a call" and "a call is a put" .
==>True enough. But sometimes the market maker (smart money) is on the other side and not the "market". When I am talking about the net long/short position I am just talking about the "market" side (ie, the "dumb" money side). When futures trade sometimes it is between two market players but sometimes it is between the market and the market maker. In those instances, you create a net long/short position with regard to the "market".
OK, now we're getting somewhere.
I see how the exchanges can say that commercials are net short or net long, because they know who the participants are and they know their positions. You're not using that method at all, are you?
If you're basing your calculation on the tape, how can you distinguish between a trade made "between two market players" and one made "between the market and the market maker"?
The answer to that question will probably clear this all up (because I don't think there is really any disagreement here, but I want to be sure I'm not missing something important).
==>Duck, I have to disagree with you on this on. The net/long short position on futures is reported all the time.
I understand what you are calculating and I understand what SouthB Itch said. I don't think they are even remotely the same thing (what he's talking about considers the category of players involved, you are netting volume at the bid and volume at the ask as they hit the tape). I'm going to research it, but I think it's going to turn out that the reported numbers are per what SouthB Itch said, and if that is the case, I will conclude that it's again a nomenclature dispute (akin to bull market/bear market).
To be clear: I am not arguing that either of those measures is of no use; I am arguing that neither one is actually what the name being used implies.
Here's a page from CFTC web site for oil futures:
From those tables you can see what SouthB Itch was talking about (though, of course, he did a lousy job of expressing himself). You can speak of, say, commercials being net short or net long, but OVERALL for all participants, the sum of shorts (-) and longs (+) is ZERO. How could it be otherwise? It's the fundamental definition of a futures contract. One party is long, the other is short.
Have a good weekend.
Regular hours, After hours I don't give a rip! The Fundamentals say that this market is going up about 25% over the next 8 months. I am a very happy Permabull and a very satisfied Bagholder.
Having a great time, your favorite d-bag