What do you guys think the Arch and NYSE merger will do to the tape reading strategy? Will the new hybrid electronic market make these large blocks more transparent, or will it make it much harder to read the side of bias? Comments
dep on what they do with specialist.... if stays how it is now....its good if goes 100% electronic (but they call it hybrid...but only blocks get done on the floor and thats it) ....kiss it good bye im hopin for option 1 d
You might want to go here. http://www.elitetrader.com/vb/showthread.php?s=&threadid=56373&perpage=6&pagenumber=1 Majority opinion there seems to be that tape reading wont be much help. ck out the posts there by Maverick77. ........ hope this helps. .... rj its Mav...74 not "77".
The nature of tape reading will evolve as more of the volume is done by program, and block. Those who move along and learn the new protocol will make money. It is about the same as it always was. Some make it, some don't. Depending on how good you were at reading the tape, you might be able to adapt in time to stay with it. If not, you will have to find another edge. Another way that the game will change is with order types. As different order types come on line, traders will have to adjust to the new game. Finally the rules of the game will change with the various exchanges. At some point, we will see different rules for shorts, for capped orders, for "looks" at listed stocks, for not held, FOK, and many others. I think it is nice of Maverick to provide a historical perspective on how traders used to read the tape. I know that some of the techniques are still good, but again as volume goes to programs, one has to expect that things will have changed big time. Eventually folks will figure it out. The game goes to the ones who make it their business to get educated, and learn the new skill sets. Good luck Steve
i was thinking that this is more a symbolic move to please the regulators and general public. i mean, listed arca trading has existed for some time now and so has island.. will the spec post more liquidity on the bid and offer via arca? i don't know what the big deal is.
i think as all trading strategies, there will be some adjusting, but if they can take all the arca's volume and put it infront of the tape readers that follow the NYSE, it can show a lot more depth to the story. Also, now that NYSE is a for profit public company, they will do their best to increase volume, reduce fees, and promote market consistency. There are already talks of opening the exchange 30 minutes earlier to get that early morning premarket volume during trading hours on the NYSE. Seems like they are doing their best to keep things as they are, and if anything, make it better for their clients/traders.
If by "tape reading" you mean looking at NYSE Open Book, yea you will probabaly need to make adjustments. Everyone will have to adjust including the specialist (assuming he has a sugnificant role).Think how a specialist might use ARCA. I consider myself a tape reader but I do not use OB. I look at how fast ARCA offers are taken out and at what levels, I use the TICKS and the TIKI. Things like that. There is more than one way to skin a cat.
i dont see the connection. prop firms should still flourish. look at Goldman, Bear Stern, Morgan earnings, blowout profits from succesful equity trading. As long as the carrot is there, the donkies will still keep chasing.