What a Nasdaq level 2 screen should look like

[Naz]

Roger asked me what traders should look for in a level 2 screen.So here it is.

On the left is the bid on the right is the ask.All the market makers and ecn's are all lined up under the heading names.So Island is an ECN and has its own book which looks like an in house level 2, but on true level 2 it is just represented by its best bid and ask under ISLD.The same goes for redibook, REDI and Achipelago, ARCA.The same goes for all the other Ecn's.If you want to be clever some software will allow you to view a true level 2 screen and also incorporate the whole of an Ecn book into the same screen.

On some level 2 screens all the Ecn's are marked so you can see them .On this one they're not. All the other names are market makers.Like LEHM, Lehman.MSCO, Morgan stanley.NITE,Nite securities,etc etc.

If you get a broker that is not giving you the true market you cant trade it correctly.I've said this before level 2 Nasdaq is not a walk in the park.It has to be learnt.The fact is a lot of people just dont know how to make it work or undersatand it.When you learn it correctly it is a dream and enhances your trading.

 

[ian]

l2

Hi Naz,

When you first looked at a level 2 screen how long was it before you made your first trade?.

ian.

 

[Naz]

Hi ian.The first time i looked at it i thought you must be joking.Then i was fortunate to be trading in the city and i was introduced and taught by an American who had just written a book called"SOES BOOK" daytrading Nasdaq using SOES selectnet and Ecn systems.

After he taught me i did my first trade within 5 minutes.I realised how much potential this system had and how this was the possible future of trading.All the disadvantages i had with any other form of trading were gone and now here i was trading side by side with Lehman, Goldman etc being a market maker myself and for once trading on a level playing field.

If you ever felt disadvantaged in your trading here was the answer.That is why i made it a mission to take my learning further in the States.To learn how to street trade it and then to teach it to others.To my knowledge I have now taught more traders in the Uk how to use it than any other person.

There were times this year in my trading room that i had taught every Nasdaq trader there.If anyone wants to learn it on a one to one basis e-mail me at [email protected].

 

[Robin]

(I presume a limited) free L2 view

Hi Naz

Thanks for your continued information its great

If anyone want to get an idea might be worth trying this link but it only covers a few of the us brokers (or whatever they are called in proper terminology)

http://www.tradearca.com/javabook/1.1/popup.htm


Naz do you mainly use the near price data to back up or hunt for
a trade or use the data thats further down and wait to see if a price enters that area and encounters resistance support based upon the figures you saw earlier. (hope that makes sense)

Cheers Robin

 

[candles]

how come all the level II screens that i see advertised always seem to look different? Is it because you choose settings to make it display certain information?. In the example of what a level II screen should look like, the whole layout looks different to what i have seen advertised and on other members post of their screens, and i dont see that "# BEST" column anywhere else either...

 

[Naz]

Hi Candles,

Many traders seem to just accept exactly what their broker gives them.Thats why i have seen people thinking they're trading level 2 when they've just been using an ecn book.

My own broker in his last update has added things that have made me say oh yes! thats brilliant and in one area i've changed one trading style to adapt to this latest update.Its pre and post market trading if you wish to know.An area where smart order routing leaves someone trading like a retail punter but with the right tools and lay out allow others to take advantage of this less liquid time of the day.Nothing in the underlying way the market works has changed but its how the data is presented and the options he gives me to trade it.

Over the years i've traded many different level 2 screens and had demonstrated countless more.The basics are the same but as a trader its knowing just what little extra's are available and how you can use them to personalise the screen in such a way that it helps your style of trading.

So i suppose the answer is.Some brokers dont give you all the bells and whistles while others do.Some brokers dont allow you to personalise the screen with different options while others do.Different software vendors of course have made the layout look slightly different as well, but underneath it all performs the same way.

 

[iq200]

Hi Naz, Out of interest, which broker are you referring to..?

Regards,

Imran

 

[vill4n]

sorry if this is a silly question,but what is the BEST column for?

azad

 

[Trader333]

I have just deleted my last post as I misunderstood the question. #Best is the number of times that a MM or ECN has been at the inside bid or inside ask during the day. So if it says 20 that means that the MM has been at the top of the column 20 times that day. This can be used to identfiy the Ax.

Cheers


Paul

 

[Vislikke]

Trader333

Is that just in terms of number of times at best bid or ask but not the volume traded ?

Is there somewhere to access this information ?

Thanks

Mike

 

[Trader333]

Yes it is the number of times at best bid or ask but not volume traded. Could you clarify what information you want access to ?

Cheers


Paul

 

[Vislikke]

Thanks Paul.

Not having Level II (yet) I wanted to know if there was somewhere you could see what volume had been traded at particular prices, and on the bid or ask side, by each MM ?

Regards
Mike

 

[Oldun]

I think it is also the number of times in the day the MM/ECN has been alone at the best bid/ask.

 

[Trader333]

I am not aware of any sites that show on a daily basis what the volume is that has been traded by each MM but you can check the monthly share volume for all Nasdaq stocks by MM at www.nasdaqtrader.com an example of which is

http://nasdaqtrader.com/asp/TDResp....e=ivgn&Hour_Period=1&Month=8-1-2003&x=58&y=11



Paul

 

[Vislikke]

I am not aware of any sites that show on a daily basis what the volume is that has been traded by each MM but you can check the monthly share volume for all Nasdaq stocks by MM at www.nasdaqtrader.com an example of which is

http://nasdaqtrader.com/asp/TDResp....e=ivgn&Hour_Period=1&Month=8-1-2003&x=58&y=11



Paul

I will check this out and do a little digging for day volume stats

Thanks Paul

 

[nyctrader]

I like it better when the Level II and the time and sales are in 2 different windows. This is the Level II window that I use called DAS PRO. See how they have the ECN books integrated right into the Level 2. That really helps show depth in the market.

[Mod's note: Post edited - please refrain from advertising on the forums - this is not permitted]

 

[johyman]

John Hyman

Roger asked me what traders should look for in a level 2 screen.So here it is.

On the left is the bid on the right is the ask.All the market makers and ecn's are all lined up under the heading names.So Island is an ECN and has its own book which looks like an in house level 2, but on true level 2 it is just represented by its best bid and ask under ISLD.The same goes for redibook, REDI and Achipelago, ARCA.The same goes for all the other Ecn's.If you want to be clever some software will allow you to view a true level 2 screen and also incorporate the whole of an Ecn book into the same screen.

On some level 2 screens all the Ecn's are marked so you can see them .On this one they're not. All the other names are market makers.Like LEHM, Lehman.MSCO, Morgan stanley.NITE,Nite securities,etc etc.

If you get a broker that is not giving you the true market you cant trade it correctly.I've said this before level 2 Nasdaq is not a walk in the park.It has to be learnt.The fact is a lot of people just dont know how to make it work or undersatand it.When you learn it correctly it is a dream and enhances your trading.

I would like to learn the levle 2 and the Total view and would like to learn it in real time trading a stock....an you help ....John

 

[Victor90]

Hi!
What is the best broker that offers level 2 accses for a guy that wants to learn to trade it?

///Victor

 

[Mr. Charts]

Alan, (Naz), hasn't posted on t2w for a very long time.

I use eSignal for my level 2 T&S and interactivebrokers as a broker.
There have been occasional disconnects between T&S and level 2, my own trades appearing on T&S sometimes 3-4 seconds after the fills, but that was only for a brief period and was normally solved by simply closing and re-opening eSignal.
Richard

 

[johyman]

level 2

Hi!
What is the best broker that offers level 2 accses for a guy that wants to learn to trade it?

///Victor

Victor,,,I live in Columbia SC and want to learn the Nazdaq Level 2 but I need someone to show me like On the Job training.....John [email protected]