Help understanding the Tape.

[notouch]

You make a good point weiwei. There are 2 reasons why tape reading may not be very reliable. The first is that as weiwei says it can be manipulated. You just as often see large orders at the end or middle of a big move as you do at the beginning. Some big players may have limit orders below 12500 for example, sell just above 12500 and then absorb the stops that get triggered. The other problem is that there aren't that many big players who trade YM. Most people who tape read follow the methods of Hubert from TTM but according to him a large order is any order above 10. Medium sized retail traders can easily trade lots of 10-50. Just because an order is over 10 doesn't mean it's institutional. If you want to see what the big players are up to you need to look at the ES tape where it's not unusual to see 500 lots coming though (equivalent to 1000 YM contracts). So the trades highlighted by Yigal could just be a few retail traders.

[cooter]

Nice synopsis, notouch. Based on the tick value of YM ($5) vs. ES ($12.50), I'd have to say that 500 ES lots would be worth 1250 YM contracts (not 1000). In any event, your points are well taken.

[keymoo]

If you can REALLY read tape, the moves and patterns that it has, it seems to me to be the MOST reliable way of trading. Watching hubert trade using tape is amazing, his entries are very accurate and usually in the right direction. Yeah he gets stopped now and then, but most of the time he hits his daily target within the first hour of the day just reading tape and market internals. He calls himself "an order flow ho". LOL

[cooter]

	Quote:	keymoo
	He calls himself "an order flow ho". LOL

That's too funny!!!

[notouch]

If you scalp for 5-10 ticks like Hubert then definitely tape reading is useful. For traders looking for larger intraday or multiday swings there are far better ways of reading price and volume.

[Nick1984]

Here's one out of left field: on the TS platform what are the white tape readings? Red and Green are self explanatory but whats the white one? Also whats the highlighted price signify?

[GCB]

	Quote:	Nick1984
	Here's one out of left field: on the TS platform what are the white tape readings? Red and Green are self explanatory but whats the white one? Also whats the highlighted price signify?

Nick,

The white orders are orders between the bid and ask. Only happens when bid and ask are more that one tick apart.

The prints with the bright red and green foregrounds are trades below the bid or above the ask, respectively.

The prints with red and green backgrounds are supposed to show some kind of trend, but to me are just a distraction. You can turn that off on TS and I recommend doing so.