For anyone not familiar with premarket or after hours trading, Putnid’s comment here was gold:
Trades outside of open market times are tricksy for a number of reasons. First, the trading volume may be minuscule (I’m talkin’ about fewer than 100 shares traded). I’ve seen it happen often. What I’ve also seen is that some off-hour trade leads to a significant change in price. Investment boards such as StockTwits light up with hyperventilations about the stock. Could be glee, could be panic, but such commentary makes waves. What to do? FIRST, check the actual stats. A number of sites post off-hour trade data. I prefer Nasdaq.com. The off-hour trades are posted in detail, noting both off-hour highs and lows. All too often, I’ll see a significant price change only to learn that a trade of 100 shares was the reason.
Bear