Step inside the world of an order imbalance. Step inside my world. You won't see this stuff anywhere else.
The stock is
. We bought 65,000 shares of Jabil yesterday into the weakness. It did nothing. We liked the stock for a trade. We liked it because it was going to have a postclose meeting that we figured would be positive. It was. But we didn't want to be in Jabil after today. Frankly, we buy a bunch of stocks for "Ts," or trades. We figure we can take some good capital gains to help subsidize our longer- term positions.
Sure enough, the meeting went well. But we didn't know how positively the market would react. Would it be a 2-point gain? A 1-point gain? A 4-point gain? Would the market hold up long enough to let us get out? We never know.
Right before the market opened we got the best insight of what we were about to make:
positively mentioned Jabil in her 9:27 a.m. break-in from the floor of the
New York Stock Exchange
. We did a couple of mild high-fives on that because when Maria B. speaks at that moment and she juices a stock, she has the power of ten
analysts all rolled up into one.
We weren't more boisterous because we are superstitious, and we don't count our chickens before they hatch. Our broker told us that the stock would now go to indication to the upside (meaning there are many more buyers than sellers -- the specialist lets everybody know that sellers are needed, and the indication serves as a call out to people, "Sellers needed, we will pay a premium."). But how much? And how much did we want to sell into the indication?
At 9:33 a.m. we got our first indication: 84-87, meaning that the stock could open anywhere between those prices, or lower if too many sellers materialized. "Try to sell 15,000 within those parameters," I barked to my trader, Clarke Longwell, who was handling the Jabil order.
He relayed the order. Seconds pass and then we hear back: "New indication, 86 and a half 88 and a half."
I counter: "Sell all 65,000 within those parameters, that's a great price."
That tipped it right back to 84-86.
The cat-and-mouse game continued.
"Cut me back to 15,000 on the hop, opening only," I scream. "Quick, quick, before we get burned." I could see the new indication coming -- just felt it, that's all.
As if on cue, Clarke yells out "New indication, 83-85."
Now I'm jumping up and down. I know that's too low. I know that if I can be sure I am cut back to 15,000 I will be able to scale out higher.
"You are in for 15, opening only," Clarke says calmly. Boom, the stock opens at 84 7/8. We sell 15,000 shares. Seconds later the stock gaps up to the 6-and-change level, where we pound out another 40,000 in increments of 5,000, feeding it to the market as it roars.
As I write, we are booking the last 10,000 shares. We will have a 6-and-change average (meaning 86.5 average roughly). A great trade. And we weren't faked out at the opening. Thanks Maria, thanks
-- the two who were most instrumental in making us money.
James J. Cramer is manager of a hedge fund and co-founder of TheStreet.com. At time of publication, his fund had no positions in any stocks mentioned. His fund often buys and sells securities that are the subject of his columns, both before and after the columns are published, and the positions that his fund takes may change at any time. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. Cramer's writings provide insights into the dynamics of money management and are not a solicitation for transactions. While he cannot provide investment advice or recommendations, he invites you to comment on his column at