Do you think Level II quotes are helpful/worth the cost for: 1- day trading tying to get <=$.25? 2- day trading going after a bigger move? 3- with large cap stocks? 4- with medium cap stocks or even pretty illiquid stocks. Thanks a lot guys!
is definately worth it...to use it properly will take some work and unfortunately most of the info. is bogus these days....but it is a tool that will help you.
bogus........I don't think my 25000 share bids are bogus! Just because I like to cxl if they print 100 shares on the bid doesn't mean bogus, i just changed my mind. L2 is a joke!
I have had L2 access since I traded SOES, which I stopped doing in 1996. Still have it, never look at it. IMO, not worth anything.
If you're scalping for quarters on nasdaq, L2 is a necessity, especially for the more volatile names since you really need to know where you can get in or out volume-wise. If you're trading off 15-minute charts or longer, it's basically just noise. Even if you don't use L2 to base your trading signals off of, you know lots of other traders use it, so it pays to be at least familiar with it -- the same could be said for earnings reports, economic data, chart resistances, etc; if you know what others are looking for and trading off of, its just another advantage.
I think if you are daytrading, you need L2. I scalp dimes, quarters and halfs--I would be lost without it.
I guess I should take another look. But it just has seemed to me lately (since decimalization), that there are too many prices with such small increments, that it just didn't seem to show me anything useful. I don't have the patience or time to scroll down and look at all the size. You have participants trying to undercut offers and raise bids by tenths of a penny. So the "market" is too thick. And it's all meaningless because when the market moves, that all disappears. And you get a bad fill if it goes against you and a good one if it is in your favor. Same results you would have without getting dizzy watching L2 screens. I will say that before decimalization, it was a useful tool. I also had a level 2 Instinet terminal, which served me very well for a long time. Now I don't have it. I would rather have the room for another quote screen (monitor). And I sure don't miss having an extra keyboard taking up valuable newspaper and magazine space
Most of my trades are for .25 to 1 and L2 would be too much of a distraction to help me. I have enough too watch without worrying if the 50,000 shares I see standing in my way are real or some ploy to scare me out of a position.
L2 is a great tool. you don't NEED it..but if you learn to use it, it can really help. some people really love to bash level2 like it is worthless. that is just so freakin stupid. if you can use it to make you money, as i have, then it is hardly 'worthless'. basically, the longer your time frame, the less need you'll have for it. up to a point where it indeed becomes worthless.