Tape Reading

[Nautical23]

G'day All,

Can I get a few idea's on the best resource's for learning to Tape Read please?

I'm currently day trading the ES using reversal signals from tick charts and volume charts. I would like too enhance my trading with tape reading.

Thankyou,
Bruce

 

[trader_dante]

Baker Library at Harvard University Business School carries the hard copies of every single ticker tape transaction that has taken place on the NYSE from 1890 forward.

Transactions that came prior to sharp moves in stock prices should be examined closely.

 

[trader_dante]

You might also want to consider reading "Tape Reading and Market Tactics" by Humphery B. Neill and "Studies in Tape Reading" by Richard D. Wyckoff.

 

[MrGecko]

great resources suggested so far... just don't forget a comfy chair and a few hundred hours.

 

[Jaydee]

Hi Bruce

It may seem obvious but the best way to learn tape reading is by doing. Get a Level 2 view and ticker view of what you are trading - now watch what happens.

Typically, you will be able to confirm support and resistance points and also get a feel of short-term pressures and momentum out of these areas. I remember reading this thread a while ago where Grantx and several other members made some excellent points regarding this topic. I hope you find it helps:

http://www.trade2win.com/boards/first-steps/33036-time-sales.html

Best

JD

 

[Nautical23]

Tape reading

Thanks JD,

Thanks for your guidance. Thats what I'm looking for. I'm currently trading the es and watching the time and sales at the same time. Watching the time and sales go wizzing down throws me off a little. But with lots of time and practice and the use of some off those techniques you've guided me too I should be in good stead in the future.

Fingers crossed.

Thanks again,
Bruce

 

[One Eyed Shark]

Also worth checking out some of the education and videos on the marketdelta website, good free info from a traders perspective on reading the order flow

 

[Jaydee]

Thanks JD,

Thanks for your guidance. Thats what I'm looking for. I'm currently trading the es and watching the time and sales at the same time. Watching the time and sales go wizzing down throws me off a little. But with lots of time and practice and the use of some off those techniques you've guided me too I should be in good stead in the future.

Fingers crossed.

Thanks again,
Bruce

No probs Bruce

I just wanted to add, these days reading the actual ticker is slightly less important than it used to be. Reasons for this are, in the old days orders used to trickle through much more slowly - less transactions and pit trading meant that you could follow the momentum from the ticker quite well. Now, with the electronic trading systems we all use, the ticker/timeofsales can sometimes throw several hundred orders through in a few seconds - that's pretty hard to read. To make it worse, algorithms slice and dice the orders into tiny shapes which can also throw a human trader off the scent. Then you have Icebergs and reloaders which can also make things difficult.

For this reason, you have to concern yourself with the order book a lot more. However, orders can often be BS and you have to work out whether they are real or spoofs. When 1000 lots suddenly disappears, was it due to a 1000 lot order going through or did some cheeky chappy delete it from the book? In short, I recon you will be focused on the Order book about 80% of the time and the ticker for the remainder.

Just my opinion, some may disagree with me here...

Good luck

JD

 

[new_trader]

Reasons for this are, in the old days orders used to trickle through much more slowly - less transactions and pit trading meant that you could follow the momentum from the ticker quite well. Now, with the electronic trading systems we all use, the ticker/timeofsales can sometimes throw several hundred orders through in a few seconds - that's pretty hard to read.

This is incorrect. The ticker didn't print odd lots, it only printed transactions of 100 shares or larger. That's why it appeared to trickle through more slowly. It also used abbreviations so that it could keep up with transactions.