Tape Reading continued.

Quote from shortseller:


One Question regarding this ... Are you suggesting ALL stale offers are meaning less???????? Because I would argue that there are some key support and resistance levels that do matter very much .. Take for example XYZ Stock ..when it was under 35 and moving up .. gets to the point.. (I don't know because that might be a strike price for options traders or if the stock just likes whole numbers. but when we finally move up there is like 105 K sitting there to sell .. (who knows for how long) but its only shown for about a second and you can see smaller day traders stepping in front of it moving it down. (this phenomena may not be considered "Tape Reading" ) but is also something that I have noticed - Are conditions like this just simply discounted as nothing? ( Sorry I hope I am not adding confusion to this discussion) thanks again in advance.

R.D.
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OK, let me try to explain this again. I do not care about support and resistance levels. I simply follow the buyers and the sellers. If there is a real buyer in the stock, a stale offer is there to be lifted. If there is a real seller in a stock, a stale bid is there to be hit. So in other words, stale bids and offers are meaningless. Don't worry about what other daytraders are doing, they are usually mooks and you just have to put up with their noise.

FWIW, when there are real buyers in a stock, there is no such thing as resistance, same goes for sellers. This is why you need to trade stocks with news. If TIF raises their earnings outlook for next year, you can rest assure that there will be real buyers and sellers in the stock and support and resistance levels are meaningless as are the stale bids and offers.
 
Quote from eusdaiki:

"For example, morons who would bid into a minus tick offer"

Forgive my ignorance but what do you mean by a minus tick offer?
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A minus tick offer is when stock is offered on a minus tick. This basically blocks natural shorts from selling stock. This allows the seller to sell stock ahead of natural shorts. For example:

50.50 x 50.51 300 x 1000
300
50.45 x 50.50 100 x 1000

Notice the 300 share bid get hit and the stock is now offered at the bid price. This is called offering on a minus. That means the stock is being offered on a minus tick there by blocking all the up tick natural shorts.
100
50.40 x 50.45 100 x 1000 still offering on a minus.

This is a stock you want to be short. If you are already short, for the love of God, do not be a mook and buy your stock back. The specialist is telling you to stay short!
 
Quote from Maverick74:

A minus tick offer is when stock is offered on a minus tick. This basically blocks natural shorts from selling stock. This allows the seller to sell stock ahead of natural shorts. For example:

50.50 x 50.51 300 x 1000
300
50.45 x 50.50 100 x 1000

Notice the 300 share bid get hit and the stock is now offered at the bid price. This is called offering on a minus. That means the stock is being offered on a minus tick there by blocking all the up tick natural shorts.
100
50.40 x 50.45 100 x 1000 still offering on a minus.

This is a stock you want to be short. If you are already short, for the love of God, do not be a mook and buy your stock back. The specialist is telling you to stay short!
More...

Thanks a lot for explanation.

Do you short the stock if it can be shorted on downtick?

What if the offer is lower than the print?
50.50 x 50.51 300 x 1000
300
50.45 x 50.48 100 x 500

The size changes too. Does it mean it is not the specialist's offer?

Thanks in advance for your advice.
 
Great, thanx for the answer.

One more question though.

If the buyer's investing horizon is long term. doesn't it mess things up for day traders picking up on the buyers move... in oder words, the buyer could be acumulating for several days before the move up begins, during those days low prices are great for the buyer, wouldn't a day trader following the buyer take constant losses during taht period of time?
 
Quote from yip1997:

Thanks a lot for explanation.

Do you short the stock if it can be shorted on downtick?

What if the offer is lower than the print?
50.50 x 50.51 300 x 1000
300
50.45 x 50.48 100 x 500

The size changes too. Does it mean it is not the specialist's offer?

Thanks in advance for your advice.
More...

If the offer is lower then the print you sell the farm. Do not BUY that stock back. Obviously you need to be able to sell on a downtick via conversions or slips or what have you. It was a lot easier when we had bullets. Same things applies for uptick bids which obviously you can do very easily.

Don't worry about the size changing. Just pay attention to the patterns.
 
Quote from eusdaiki:

Great, thanx for the answer.

One more question though.

If the buyer's investing horizon is long term. doesn't it mess things up for day traders picking up on the buyers move... in oder words, the buyer could be acumulating for several days before the move up begins, during those days low prices are great for the buyer, wouldn't a day trader following the buyer take constant losses during taht period of time?
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The answer is no. It does not matter what the buyers horizon is because we are looking for AGGRESSIVE buyers. Not PASSIVE buyers. Like I said before, if you are trading news stocks, there will be real buyers and sellers in the stock and they will not be patient. They have stock to move and they need to move it, NOW! This is why you need to throw TA out the window. All you should be looking at is your quote page. Not time and sales! Just quotes! Time and sales you should look at only if you step away from your computer and you need to see the prints.
 
Quote from Maverick74:

If the offer is lower then the print you sell the farm. Do not BUY that stock back. Obviously you need to be able to sell on a downtick via conversions or slips or what have you. It was a lot easier when we had bullets. Same things applies for uptick bids which obviously you can do very easily.

Don't worry about the size changing. Just pay attention to the patterns.
More...

Thanks a lot. I'll try this pattern for both longs and shorts.
 
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