When it comes to trading penny stocks or any other securities, it’s important to understand different trading sessions. Do you know what pre-market trading is? Whether you’re looking for an opportunity to invest beyond normal trading hours or simply searching for more indicators of how the market will perform in a given day, pre-market trading opens up a number of possibilities. I created this infographic to demonstrate the drivers of price movements outside of normal trading hours, and how you can use this information to get an edge as an investor.
Do you know why pre-market trading is important? Then check out this cheat sheet now.
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News doesn’t stop outside of normal trading hours. The impact of earnings reports and major world news can drive major price changes and trading activity before and after the market is open. Using ECNs, investors can capture an opportunity to react to such news right away. Additionally, the movements of other investors during the pre-market session provides an excellent indicator of the day’s impending activity. Whether you’re trading penny stocks or simply gauging the market’s reaction to news and earnings reports, pre-market trading is a critical session to track.