Pre-market trading
Pre-market trading is the session before the regular US market opens, from 4:00 a.m. to 9:30 a.m. Eastern Time. Fewer traders are active, so order books are thinner and spreads are wider, and most brokers accept only limit orders.
Why it matters to a small-cap momentum trader
For a small-cap momentum trader the morning starts here. News that breaks overnight or early in the morning hits before the bell, and the stocks that gap up on it show up on the pre-market gappers list with real volume behind them. The pre-market high and low become the levels traders plan the open around. The thin book cuts both ways: prices can jump on small orders, and a stop may fill far from where you set it.
The rules
Hours. 4:00 to 9:30 a.m. ET, then the opening auction at 9:30. After-hours trading runs from 4:00 to 8:00 p.m. ET. On an early-close day the regular session ends at 1:00 p.m.
Orders. Brokers typically take only limit orders in extended hours, and the order has to be marked to stay live outside the regular session.
No LULD bands. LULD bands apply only in regular hours, so a pre-market move has no band and no LULD pause.
Pre-market in Hindsight Markets
A replay can start at the 4:00 a.m. pre-market open, at the 9:30 bell, or at any time you choose. Extended hours take limit orders only, with Day+ to keep an order live outside regular hours, and the book, tape and scanners run through the pre-market as they did that day.
Practice this on a real past day in Hindsight Markets
Start a real past day at 4:00 a.m., watch the gappers build before the bell, and trade the pre-market with simulated money.