Twitter has finally priced. Everyone is worried about a technology glitch, but I have slightly different concerns.
I'm anticipating that the stock will open for trading some time between 10 and 10:30 AM ET. That's assuming a relatively tame opening pricing, say, around $30.
My concern is that this could be a moonshot open. Like, at $40 or higher. If that is the case, it could take longer to open.
The underwriters certainly do not want it to open at a huge premium. Why? Because nobody wants a Facebook; in other words, a botched initial float. Everyone has a vested interest in an orderly open and orderly trading throughout the day. They want the stock to open modestly higher, then move up (slowly) and close up.
Of course, nobody controls the market and anything can happen.
That said, there are ways that a crazy, moon shot open and trading day can be mitigated. For example, the book-runners know where most of the shares are. They may try to have an expectation with the offering price owner on how much they will sell...and also how much they may have to buy in the after-market.
The book-runners will also have a 15 percent "greenshoe" (over-allotment) they can exercise to control the price.
What about the opposite: Could the deal go south and drop below the initial offering price on the first day? It's possible, but I would bet against that as well. This is THE big initial public offering (IPO) of the year. The book-runners will certainly be expecting buyers to be on their best behavior.
That means keeping flipping to a minimum. Additionally, while they cannot make any demands, the underwriters will also likely expect the buyers to have aftermarket orders to support the initial price.
What about a technology glitch? Yes, it could happen, but there are many brakes in place.
First and foremost, the stock will not open unless the man in charge says it can open. That would be the Designated Market Maker (DMM), who is the man on the NYSE floor in charge of trading the stock. If there are still orders that want to get in, he gets them in and adjusts the price. It doesn't go public until he yells to the crowd (and the book-runners on the phone) that "The book is frozen."
That old-fashioned approach greatly reduces the chances of a glitch at the open.
What MIGHT happen: A dreaded trading halt. Once it does open, trading will be fast and furious for sure, but again there will be circuit breakers in place. They're called "Limit Up, Limit Down" rules, and they would halt trading for five minutes if a stock moved a certain percentage (10 percent in most cases) from the average price in the prior five minutes of trading.
There was a trading halt with a NASDAQ IPO last week. These rules were put in place after the Flash Crash of 2010 to prevent stocks from cascading up or down during periods of high volatility.
A trading halt some time after the open is a possibility, but it's likely that the DMM will be heavily "layering" the book (putting in bids and offers around the price the stock is trading), and that will reduce the chances of a halt.
—By CNBC's Bob Pisani