Tape Reading

Discussion in 'Technical Analysis' started by trader28, Nov 9, 2005.

  1. Thank you, Cool. I've noted (and learned from) your posts in the past, and I appreciate this latest contribution. This is exactly what I'd sense from my (albeit limited) examination.

    I'm wondering if you wouldn't mind clarifying one point:

    When you say "bid asks in index futures, don't work" do you mean bid/asks that are NOT inside bid/asks don't work? Or do mean ALL bid/ask that are not at the last traded price should be ignored?

    Specifically, if the last traded price is on the bid, do you treat the inside offer the same way you would the offer three or four or five levels up? Are you saying, literally, that the only orders that count are market orders? Period?

    Thanks again.
    #151     Nov 13, 2005
  2. Stalker


    thanks coolweb,

    the idea that i have as a starting point is the same as yours, that the limit orders are the orders of losers.

    I´ve got the idea from different people here at ET that price gravitates towards high bid/ask size instead of the opposite. That is if cumulative bid size is bigger the market is more likely to go down, if ask size is bigger it´s going up. This makes perfectly sense in theory. The big players needs someone to take the other side of their trade. The tricks in the orderbook is a reflection of this.

    I´m more or less saying things here that other people have already written, just wanna point out that I don´t claim these ideas to be my own. But I´m convinced that this is true. The tricky part is how to use it practically, in what situations to look at bid/ask size and how?
    For example I believe that it sometimes could be possible to spot fake break-outs and moves that are going to be faded if you can spot fake orders and use this information together with the bid/ask size.

    Everything I say here is just theory though, and if you can´t use it practically it´s a completely useless theory. All opinions on this are welcome.

    best regards,
    #152     Nov 13, 2005
  3. Macro, what data feed does TapeReader run on? Got it loaded but no data?

    #153     Nov 15, 2005
  4. I agree. Probably were giving them away:

    #154     Nov 15, 2005
  5. Can you elaborate a bit more on this?
    #155     Nov 15, 2005
  6. Babak


    What sort of time frame are you guys talking about? tick by tick? minute bars? 5 min. bars? 15 min bars? I would argue that the time frame matters as 'painting' would create much less noise when you go into the longer time frames.
    #156     Nov 15, 2005

  7. currently TapeReader needs a TradeMaven dome up with a "profile" selected to "S&P live" and "esignal" for the feed ---- then you also have to have esignal active at the time feeding the data. if you have any questions then PM me and i can go into more detail for you. this trading tool is brand new so it will be a few weeks to get everything going and hear feedback from users in which to make enhancements from.

    also the TapeReader web page is now active with one very short video to give a brief description of how to activate TR -----

    #157     Nov 15, 2005
  8. A REAL trader WOULD waste time argueing with you. Because a REAL trader has lots of time on his hands from winning so much money and has nothing better to do with his time than to hang out on the computer.
    #158     May 14, 2006
  9. mokwit


    One dimension not being homed in on is that as much as the action on the tape itself, the old tapereaders would have been looking at the tape to see which groups/pools were active i.e who as well as what.
    #159     May 14, 2006
  10. What's not talked about on this or the other excellent thread on tape reading is timing aka pace of price development -- one reason why I never gravitated towards tick-based charts. Pace becomes a far more critical component to tape-reading in homogenous, ecn-structured markets (electronic futures) which do not involve any human intervention/safeguards (specialists, mm "preferenced" orders) that may interfere with prices expressing themselves as "purely" as possible. Of course, as with equities, it is far easier to catch patterns and rhythms in less "crowded" markets.

    As an aside, some may knock charts as just vestigial history, especially the pure tape readers, but I think that goes too far. Sure, nothing beats seeing and experiencing how price movement unfolds in real-time, but a close second best is just looking at how prices got to where they are now. One skill worth acquiring is sizing up a chart and being able to literally replay the moves in your head, a sort of "empathic" catching-up on the past to give you a heads-up on what may come next. Just my .02 on the topic.
    #160     May 15, 2006