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Tape is my shape (tape reading, time and sales)
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Tape is my shape (tape reading, time and sales)

  #91 (permalink)
Market Wizard
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rocky9281 View Post
Why is tape reading not working?

In this TICK chart, I have marked all the block trades for that day, as they appeared in the time and sales window.


# The volumes that are red,occurred at bid
# The volumes that are green,occurred at ask
# The volumes that are black,occurred inside bid and ask.


I have assumed that trades above 10,000 size as block trades. The total volume for that day was 5,035,618.

There were many large volume trades which didn't yield a legitimate move in their direction.

What's wrong????

1.Aren't these blocks large enough?
2.Aren't the pros playing intraday?
3.Are the market makers playing against the pros?
4.Are the bid side trades wrongly showed as ask side trades (and vice versa) in the time and sales?

5.Do the pros support the price after buying ?

Seniors and experienced members please help

A few issues.

You are not really tape reading. What you have there is 1 tick + volume, this is very different from trades hitting the ask vs trades hitting the bid. From your chart, it's impossible to differentiate between trades hitting the bid/ask.

As has been said - people placing market orders are only part of the equation. Size will normally have a reaction and often it won't. Tape reading is not a 'snapshot' activity - you are looking at changes over time, an individual tick means nothing.

If you see 1000 at ask, uptick, 1000 at ask, uptick, 1000 at ask, uptick, 10,000 at ask, up tick - what does that tell you? That there are more buyers? Nope. It tells you that the guys sitting on the offer with limit orders are becoming more aggressive. Depending on the market, this may be significant.

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  #92 (permalink)
Market Wizard
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pbylina View Post
If Pros wanted so bad to hide that they were buying then no one would ever see any big lots. Just my opinion.

Depends on the market. On the ES - the CME does a pretty good job of splitting the trades.

For thinner stocks - I know a guy that uses some fairly sophisticated software to build up positions in a stock prior to earnings announcements.

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  #93 (permalink)
Fortitudo et Honor
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Negative Volume Index (NVI) Definition

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  #94 (permalink)
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josh View Post
1.You're beginning to see the incorrect logic of trying to associate "big order" with "right direction." Remember that for every large market order, someone else is on the other side of it, absorbing it. It's not that tape reading is not working, it's that you are making assumptions which simply are not correct.

2.You said you've been working on tape reading for about a week. Do you really think that people who pay millions of dollars for software designed to hide their intentions by using complex algorithms can really be found out so easily from a time and sales window, much less by someone who has been looking at it for such a short period of time? Honestly, the earlier posts between some of you guys simply doesn't make sense, and you're drawing incorrect conclusions from what you're seeing I'm afraid.

1.Please guide on what else to look for before entry, after I see a big block trade? How to know who is the buyer and who is the seller?

2.I realize that I don't understand most of the things in tape reading.Please guide.I want to learn it badly.

3. Please tell the names of good books/websites or any other useful resource where I can learn tape reading.

Lastly, Please present your analysis based on my chart. If you need more resources/data for that purpose, please let me know.

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  #95 (permalink)
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DionysusToast View Post
A few issues.

1.What you have there is 1 tick + volume, this is very different from trades hitting the ask vs trades hitting the bid. From your chart, it's impossible to differentiate between trades hitting the bid/ask.

As has been said - people placing market orders are only part of the equation. Size will normally have a reaction and often it won't. Tape reading is not a 'snapshot' activity - you are looking at changes over time, an individual tick means nothing.

2.If you see 1000 at ask, uptick, 1000 at ask, uptick, 1000 at ask, uptick, 10,000 at ask, up tick - what does that tell you? That there are more buyers? Nope. It tells you that the guys sitting on the offer with limit orders are becoming more aggressive. Depending on the market, this may be significant.

1.As I said earlier, I've marked the block trades as red (at bid),green(at ask) and black(inside bid & ask). Please let me know if some more information is needed.

2.It seems that the sellers are luring in buyers by pulling the asks. Am I correct?

3. Please tell the names of good books/websites or any other useful resource where I can learn tape reading.

Lastly,please present your analysis based on my chart. If you need more resources/data for that purpose, please let me know.

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  #96 (permalink)
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rocky9281 View Post
1.Please guide on what else to look for before entry, after I see a big block trade? How to know who is the buyer and who is the seller?

I can't help you with what to look for in this case, as I don't base entries on block trades I see on T&S.


rocky9281 View Post
2.I realize that I don't understand most of the things in tape reading.Please guide.I want to learn it badly.

Why do you want to learn it so badly? Have you tried other methods and failed? I keep T&S up, but I don't center my trading around it because I feel that it's too difficult, especially in a market which has very high volume. If your tape shows 90 rows, then if a large order comes in, you will never even see the orders. I like to see if a large number of orders comes in and price doesn't move, for example--I find this helpful, but do not make primary trading decisions based off of that.


rocky9281 View Post
3. Please tell the names of good books/websites or any other useful resource where I can learn tape reading.

For modern-day computer age trading, I don't know any. Wyckoff has a book, "Studies in Tape Reading," but in his day he would see prints occur every few minutes, or seconds in a very fast stock, not milliseconds like today. There is a tape reading pdf/video that has the word "BS" in it, I'm sure you can find it if you look, but I wouldn't pay much for it, it's not very helpful to me personally, but then again I never put that much effort into watching it as it's based mostly on trading bonds.


rocky9281 View Post
Lastly, Please present your analysis based on my chart. If you need more resources/data for that purpose, please let me know.

Can you post a 5 minute chart of the stock for that same day, with volume at the bottom?

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  #97 (permalink)
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josh View Post
I can't help you with what to look for in this case, as I don't base entries on block trades I see on T&S.

In that case, please teach me your entries and exits.




josh View Post
Why do you want to learn it so badly? Have you tried other methods and failed? I keep T&S up, but I don't center my trading around it because I feel that it's too difficult, especially in a market which has very high volume. If your tape shows 90 rows, then if a large order comes in, you will never even see the orders. I like to see if a large number of orders comes in and price doesn't move, for example--I find this helpful, but do not make primary trading decisions based off of that.

Please share with me how you combine Time and sales with other methods that you use.




josh View Post
For modern-day computer age trading, I don't know any. Wyckoff has a book, "Studies in Tape Reading," but in his day he would see prints occur every few minutes, or seconds in a very fast stock, not milliseconds like today. There is a tape reading pdf/video that has the word "BS" in it, I'm sure you can find it if you look, but I wouldn't pay much for it, it's not very helpful to me personally, but then again I never put that much effort into watching it as it's based mostly on trading bonds.

Its called nobsdaytrading course. I have the book as well as the video.




josh View Post
Can you post a 5 minute chart of the stock for that same day, with volume at the bottom?

Please find the chart attached

Attached Thumbnails
Tape is my shape (tape reading, time and sales)-5mincandles.jpg  
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  #98 (permalink)
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rocky9281 View Post
Please find the chart attached

Can you post the same chart, only not as wide? The horizontal to vertical ratio is almost 3:1 on your chart, please make your chart narrower.

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  #99 (permalink)
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josh View Post
Can you post the same chart, only not as wide? The horizontal to vertical ratio is almost 3:1 on your chart, please make your chart narrower.

Will this do?

Attached Thumbnails
Tape is my shape (tape reading, time and sales)-new.bmp  
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  #100 (permalink)
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rocky9281 View Post
Will this do?

Yes, I will make some annotations either late this afternoon or when I get home tonight, I'm walking out the door in 5 minutes right now. I don't trade stocks, bear in mind, much less that stock, so I don't know how useful my chart will be.

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