Tape Reading

I´ll try a serious question, hope you don´t make fun of me for the rest of the weekend :)

I´ve been looking at bid/ask size and the orderbook for YM and ES for a while, trying to spot patterns. I would lie if I said I was successful. if I see something working one day, it doesn´t work the next day. I´m trying to look for fake orders and shifts in bid/ask size but still no success. I´m basically trying to get a better timing for entries and if possible to spot false break-outs, the charts are still my main source of information.

Are there any traders here that successfully read the tape for index futures. Any hints about what to look for/in what direction to look?

best regards,
Stalker
 
Quote from Stalker:

I´ll try a serious question, hope you don´t make fun of me for the rest of the weekend :)

I´ve been looking at bid/ask size and the orderbook for YM and ES for a while, trying to spot patterns. I would lie if I said I was successful. if I see something working one day, it doesn´t work the next day. I´m trying to look for fake orders and shifts in bid/ask size but still no success. I´m basically trying to get a better timing for entries and if possible to spot false break-outs, the charts are still my main source of information.

Are there any traders here that successfully read the tape for index futures. Any hints about what to look for/in what direction to look?

best regards,
Stalker
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I have never heard of anyone having true success in tape reading the YM or ES. I tried for a year to do it and came up empty handed. I think its that they are so liquid you really have to read the charts and not the tape. Just my 2 cents
 
Quote from Steve Tvardek:

I've decided that Jan 1, I am going to really focus on learning how to become proficient in trading the SHO stocks. When things do change, I dont want to be left out to dry :D
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Aha. Interesting. Any particular reason why you're not trading SHO stocks now?
 
Quote from Stalker:

I´ve been looking at bid/ask size and the orderbook for YM and ES for a while, trying to spot patterns. I would lie if I said I was successful. if I see something working one day, it doesn´t work the next day. I´m trying to look for fake orders and shifts in bid/ask size but still no success. I´m basically trying to get a better timing for entries and if possible to spot false break-outs, the charts are still my main source of information.
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What are you looking at? The bid/ask or intraday charts? What are you timing your entry on? An intraday chart or bid/ask pattern? Or daily chart??
 
Quote from 2yearNewbie:

I have never heard of anyone having true success in tape reading the YM or ES. I tried for a year to do it and came up empty handed. I think its that they are so liquid you really have to read the charts and not the tape. Just my 2 cents
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I'm inclined to agree. A few weeks ago, I posted an idiotic query about order flow that, blessedly, everyone on this board ignored: it set new lows for naivete and general cluelessness -- a genuine accomplishment given some of the posts I've seen here on ET. But I digress...

The non-answer did not deter me from a dive down the rabbit hole of order flow/bid-ask size/spoofing, etc., and, over the past three weeks, I've become quite the monk of the subject. Granted, three weeks asymptotically approaches nothing in the grand scheme of things but, it's all I've got at the moment. With that caveat in mind, from what I've seen, there is no consistently exploitable (note the adverb) rhyme-or-reason to the tape, as far as the ES is concerned. Size on the ES is a function of pawn moves in a chess game too cosmic to be read by such quaint techniques as "tape-reading," at least as I understand it.

By the way, has anyone just sat and watched price action, from the open to the close, without any thought of calling turns -- or even "paper-trading", not to mention real trading? I mean, sitting there, watching price, not trying to second guess. Just watching...

I did that this past week. Watched the ES and volume. RTH from the open Monday to the close Friday. If I'd had the time (which, alas, I don't), I'd do it for another month. It was that enlightening, at least to me.

The more I study and think about this stuff, the more I am inclined to agree with fengshui-123 -- price action alone tells the tale of the tape. The rest is just noise.
 
Many thanks for the links Macro, but the first one doesn't seem to work, somehow.


(Geesh, with just two ignores this whole thread suddenly is readable...)

Quote from MacroEvent:

excellent tool for tape reading will be available on the 12th

http://www.mmti.com/TapeReaderInfo.htm


here is a partial screen shot {this shot does not have the scrolling T&S showing} --

http://www.ttrader.com/mycharts/display.php?p=37264&u=macroevent&a=MacroEvent&id=1511

http://www.ttrader.com/mycharts/display.php?p=37265&u=macroevent&a=MacroEvent&id=1511

http://www.ttrader.com/mycharts/display.php?p=37266&u=macroevent&a=MacroEvent&id=1511
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yes if you see they will have that link active sometime today as the site was being upgraded to include all the new info --- the TapeReader platform guys are working to get everything updated with all the new info for you by today. just keep checking the link today or tomorrow to see what TapeReader is all about.

i have watched TapeReader for a couple of days now and i like what i see --- good idea imo --- you will see what i mean once you get a chance to view the TapeReader tool in action.
 
I'd like to share:



bid asks in index futures, don't work.

Time and sales are much more important.


Players who want to buy/sell go market,
bid and asks limit orders are loser orders, they don't move the markets

In index futures, even more so, its more about key price ranges which is why somebody who's going to drop 100 contracts will not sit around watching bid /asks. Key is to watch how volume is effected/supported in these key ranges is what makes the market MOVE.
 
Honestly, its because I am making very good money in the stocks I trade now. I do trade SHO stocks here and there so I know how to trade them, but I still prefer the stocks with the uptick rule because they are more inefficient. Some other traders in my firm prefer the SHO stocks now and think they are actually easier to trade. So I am not too worried about the adjustment period.


Quote from ilganzo:

Aha. Interesting. Any particular reason why you're not trading SHO stocks now?
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