tradingRAW

"To see things as they are and not the way you want them to be requires good vision and a reasonable intellect. Actually, it is better if we have no intellect working at all. This test will illustrate what it takes to be a success using a Zen approach to the market." I think we make day trading hard, by trying to make it easy. It’s much easier to look at charts or technical indicators but I feel I encounter information overflow. When I first started my eyes wonder to keep up with different information on the stock and I end up missing other opportunities developing. When what all I need is right in front of me on my quote window rather than trying to mentally digest many different information on the same stock to help determine a direction. Imagine looking at MACD, trend lines, Stoch, Bollinger, ….etc on the same stock, it actually makes it harder and requires more talent out of a trader to track redundant information originated from the quote window. I gauge interaction between buyers (bid) and sellers (ask/offer) once the last trade has been made. I do use a simple classifying technique to help determine if it was a transaction initiated by a buyer or a seller so that I can get a feel where sellers/buyers are getting filled and then reference where the bid/ask are. It’s very easy to get a sense of weakness in a stock when the last transaction is 20.75 and now you can buy for 20.74 or you sold at 20.75 now stocks bid 20.76 for a feeling of strength. In my group we focus on mastering 3 elements: Content, Execution, and Discipline. The toughest part is execution as intraday price volatility gets everyone who is not skilled. How ever you decide to trade keep it simple and try to find the lowest common denominator in your strategy.

Evroom, Excuse my ignorance but what the heck is DOM! lol....tape reading is a skill on top of applying logic to price action, tape reading alone without logic does nothing, for example here is friday trade video, as skilled as I am with the tape KBH presented a problem because it failed to smooth out. But unlike say FINL where tape failed but logic applied to why the stock shot up helps me redefine pivots and rework the trade at a higher level taking cue from the tape. Tape reading alone isn't the answer but its a tool you'll need and is far superior to charts, of course that is my opinion. But I started out as a chartist just like every new trader because visually its more appealing. If you want to be a serious trader and take size of 10k or more you have to learn how to affectively read the tape. The interaction between Bid/Ask and the Last Print can really tell the story. You start to notice from my trading that consistency is really a skill set and not perfect set up. Its a war between you and the stock and your p/l is the score, its isn't going to be pretty and clean just like there is never a clean boxing match or a shut out in basket ball, you will have losses but the skilled trader will over come them and by the time the market close finish on top....of course hopefully over their cost. [ame=http://www.youtube.com/watch?v=uuwDWWDBVto]YouTube - day trading in action 9-24-2010[/ame]

I had posted a link to demonstrate how tape reading can be done consistently where I desktop record my trades daily for a one month period. I appologize to the moderator if I came off as a spammer because I have links to my commercial website. I removed them so that now it can be just a free educational site. Originally my youtube site was a means to share my trades with my remote group traders but it has found some success to the public and now I like to share it in attempt to help others better their trading. Only tape reading can allow a trader confidence to take size and not feel like your gambling, there are patterns in the tape that dictate strenght and weakness. But what's most important through my 10+ years as a day trader is really not charts or tape its about what it is you are trading and why it must move. So before tape or chart you better have stocks that have some sort of catalyst to drive prices in either direction otherwise any tools you use to help enter a trade will fail do to the lack of follow through. I think what turns people off to my style is that its very skills oriented, I'm in and out allot working the trade until some sort of smoothing affect happens in the stock and i go for the kill with size usually 10k which might not be allot for bigger traders. I'm almost one on one with the tape and drawing pivots along the way.

Here's a demonstration of me tape reading RHT and managing it strictly with the tape. Hope it helps. [ame=http://www.youtube.com/watch?v=9CAVgB2mS5s]YouTube - day trading in action 9-23-2010[/ame]

Tape is just one element to successul trading. If stocks fail to follow through then all execution tools whether it maybe tape or charts will fail. So the element of content plays a critical role in a person consistent success. Stocks must have a catalyst to drive coordinated buying and selling amongst market participants. I've posted about 27 daily videos back to back to show some transparency that day trading can be done. Yes its hard but its all about skill development. I gauge level one, level II can work but allot of size dissappear and you can get wacked if your a bid/ask size fronter.

No charts allowed, just kidding. I'm 90% tape reading and 10% charts. Charts are a catch up tool allowing me to get abreast of what i've missed if I haven't been watching the stock. There is little information on tape reading out there. Everyone seems to be chart oriented. I'm here to tell you tape leads price action while charts lags. Lets talk tape.

I agree with what you are saying, I can recall in my early years as a prop trader...I couldn't live without my real-time charts, but found out tape reading is far superior. Tape reading in modern day sense is the modern day quote screen having these elements: Bid, Ask, Last Print, Bid/Asksize, High, Low, Net Change. Last Prints are not the only thing available to a skillful tape reader unlike charts which tracks prints. Elements I mention and the way it interacts with prints leads and to a skillful reader can sense strength and weakness. Here's an example of tape reading on youtube. The chart above is there for those who are more visually oriented but positions are manage solely on reading the tape(quote screen).

i trading mainly base on tape, you can develope a feel for strenght or weakness. there are allot of other things one can look at and its not only prints its bid/ask updates after print, what i call referencing. there is narrowing of spread, how it narrow can give an astute tape reader sense of direction. other thinges are uptick bid, offer on minus, perfect prints...these will never been seen on a chart.

"Tape reading still looks at prints that occurred in the past, albeit the immediate past" not so..there are elements in the tape that can help a trader spot shift coming.

Charts are lagging indicator where as tape reading leads price action.