Discussion in 'Technical Analysis' started by Techclerk, May 17, 2008.

  1. Techclerk


    How can someone see Level III for OTCBB?

    I understand level one. Level two helps me understand what is going on better.

    I see the leading order of each market maker, but I can't see the depth of the orders. Also, I can't see orders that happen to be smaller than the lot size for that trading price.

    Must I be a market maker myself to see this? Or is there another way?
  2. Techclerk


    Sorry to be annoying, but this is the first post I've put on the forum and it has no responses. To bring it up the ranks again I'd like to point out something else I've found interesting.

    Looking at Level II, I place a a limit order at a price that takes the leading bid. I see one of the market makers move up the bid collumn to the top position.

    Then the market maker who is placing my bid also puts a leading ask order and the ask price drops. The ask is not my order, but I believe it exists because of my order.

    The new leading ask order seems to be a reflection of my bid order. If I cancel my leading bid, then the leading ask evaporates at the same time.

    Does anyone have an idea why the market maker does this?
  3. Techclerk


    Another question:

    My broker is well known. I've heard about them all my life and if I watch enough television, I see the ads every day. But they do something I think is very sloppy looking, but I wonder if it is calculated.

    For example, I can enter a symbol in the toolbar that exists at the bottom of their webpage and get the bid price. It looks good to me, so I'm tempted to place a market order. Before confirming the order, I get a caution that the quote is at least 10 minutes old.

    From different sources, I see the quote is definitely at least 10 minutes old. As a matter of fact, that bid dropped over 50% two days ago! I would be very disappointed with my results if I tried to take my profit based on the info given to me.

    Why does a broker use data that does not reflect the actual price? If I look at the "Detail" for the stock, I can see the genuine bid. I get the feeling that the misinformation is deliberate, because one part of the website knows the true numbers and the order entry portion of the site uses wrong number.

    I see old bid and ask prices, or I see bid and ask and last trade all equal, or I see bid and ask both equal to zero cents.
  4. maxpi


    I don't think most traders on ET are involved in OTC stuff. It seems to be a little world unto itself really.
  5. Techclerk


    I've worked for 2 companies listed OTC and started looking at those stocks when I was offered employee incentive stock option plans. If those plans are out of the money, you can do better on your own with a brokerage account.

    Also, the board of directors in some companies will spend nice money to drive up the closing price on the day those strike prices are set. That is a semi-annual event if they have new employees who qualify. You can read the SEC reports to see which day of which week of which month they have historically driven prices up.

    If the stock is weak, the board thinks they can save money buying up stock. They can spend about a thousand dollars to cheat the new employees out of the first fifty thousand dollars the could have made if the stock price was left alone.

    Sure, the next day the price crashes, but it still makes sense to them.