Tim Bohen, lead Trainer with StocksToTrade is discussing something that is one of the most often asked questions today. And how many traders tend to overcomplicate it… Level two quotes.
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Level two quotes can be confusing if you don’t know what you are looking at. Many traders see all these numbers and colors and wonder what it represents — the how and the why. And how exactly you can use it to trade.
To break it down, you've got two sides to the level two box. There’s the bidders and the ask. On the left you have the bid side. These are buyers. Then in the next column, you have the price those bidders are willing to pay. The ask is your sellers.
On the right, there’s the level one box. This shows completed transactions. Remember, unless someone is willing to buy and someone's willing to sell, nothing happens with a stock. No trade is executed. It’s best to stick with liquid stocks. They have what is called a tight spread. The difference between the bid and the ask is only a couple cents. A less liquid stock would have a wider spread and less activity. This makes it difficult to get in and out. So, it’s best to avoid stocks that are illiquid.
So, how do you make trades off of level two? This is sometimes an unpopular opinion, but especially in liquid stocks, it’s very difficult to get a read. There’s a lot of HFTs, high frequency traders, meaning there's a lot of spoofing going on.
Look for sentiment. Is the bid upticking? Do you know bidders are coming in? That would be a bullish sentiment. Or are the bidders going away? Are they lowering their price? Is the size going away? Less buyers means less bullish. Vice versa if you're short, you want to look at the ask side and see if there are a lot of sellers. And are the sellers dropping their price? That could be interpreted as bearish.
In summary you should be familiar with level two. You should understand how it works. But remember only price pays. Focus on the chart, focus on the candlesticks. Unfortunately, there’s also a ton of games in level two, making it tough to get a read. While it's useful, don't put too much emphasis on it either.
#StocksToTrade #TradingStrategies #Level2
*Tim Bohen teaches skills others have used to make money. Most who receive free or paid content will make little or no money because they will not apply the skills being taught. Any results displayed may be exceptional. We do not guarantee any outcome regarding your earnings or income as the factors that impact such results are numerous and uncontrollable.
You can lose money trading stocks. Do not invest money you cannot afford to lose. You understand and agree you will consider the important risk factors in deciding to purchase any of our products or services.
🔴 Subscribe for more free Stock Trading tips: YouTube.com/StocksToTrade
Share this video with a fellow Trader: https://youtu.be/ktEfCxuUXTg
✅ Links we mention and recommend:
Try StocksToTrade for $7: https://bit.ly/2Z0En9o
Get our FREE weekly watchlist here: https://bit.ly/2MXHisS
Check out the SteadyTrade podcast: https://steadytrade.com
✅ Recommended video: https://youtu.be/KKQ1y7rOsFo
✅ Recommended playlists:
Stock Trading 101: A Day Trader's Guide: https://www.youtube.com/watch?v=G_v3GMkKCjk&list=PLWWz2BSabm3bG64ohfJ-CnnVTjLCWwvei
Advanced Stock Trading Tips: https://www.youtube.com/watch?v=OXLs_-PgMUk&list=PLWWz2BSabm3YCZdk7ocrBXGJaLVXXFUYb
StocksToTrade Software Tips and Tricks: https://www.youtube.com/watch?v=jiTi-chHNyo&list=PLWWz2BSabm3ay_lvQC9JN_1niB78bI7ga
Weekly Trading Recap Videos: https://www.youtube.com/watch?v=_n0XaDt1XFY&list=PLWWz2BSabm3b3-4DcEx98TzNPLAKcq6ES
✅ Follow StocksToTrade on social media:
Instagram: https://www.instagram.com/stockstotrade/
Facebook: https://www.facebook.com/StocksToTrade/
Twitter: https://twitter.com/StocksToTrade
Level two quotes can be confusing if you don’t know what you are looking at. Many traders see all these numbers and colors and wonder what it represents — the how and the why. And how exactly you can use it to trade.
To break it down, you've got two sides to the level two box. There’s the bidders and the ask. On the left you have the bid side. These are buyers. Then in the next column, you have the price those bidders are willing to pay. The ask is your sellers.
On the right, there’s the level one box. This shows completed transactions. Remember, unless someone is willing to buy and someone's willing to sell, nothing happens with a stock. No trade is executed. It’s best to stick with liquid stocks. They have what is called a tight spread. The difference between the bid and the ask is only a couple cents. A less liquid stock would have a wider spread and less activity. This makes it difficult to get in and out. So, it’s best to avoid stocks that are illiquid.
So, how do you make trades off of level two? This is sometimes an unpopular opinion, but especially in liquid stocks, it’s very difficult to get a read. There’s a lot of HFTs, high frequency traders, meaning there's a lot of spoofing going on.
Look for sentiment. Is the bid upticking? Do you know bidders are coming in? That would be a bullish sentiment. Or are the bidders going away? Are they lowering their price? Is the size going away? Less buyers means less bullish. Vice versa if you're short, you want to look at the ask side and see if there are a lot of sellers. And are the sellers dropping their price? That could be interpreted as bearish.
In summary you should be familiar with level two. You should understand how it works. But remember only price pays. Focus on the chart, focus on the candlesticks. Unfortunately, there’s also a ton of games in level two, making it tough to get a read. While it's useful, don't put too much emphasis on it either.
#StocksToTrade #TradingStrategies #Level2
*Tim Bohen teaches skills others have used to make money. Most who receive free or paid content will make little or no money because they will not apply the skills being taught. Any results displayed may be exceptional. We do not guarantee any outcome regarding your earnings or income as the factors that impact such results are numerous and uncontrollable.
You can lose money trading stocks. Do not invest money you cannot afford to lose. You understand and agree you will consider the important risk factors in deciding to purchase any of our products or services.
Where do you get level 2 ?
All of the old school traders sware by Level 2. Charts are very important but they're past tense. I'd put mastering tape reading above chart reading but you need both to be CPT.
Very goog
A lot of traders say I see big sell orders on L2. Then on the tape, I don't see, even having it filtered out for big prints. Sometimes I see big prints on the tape to sell then, million-dollar orders to sell, then it ramps up. Not sure why. Or I will see million-dollar orders to buy on the tape then it flushes.
I think level 2 is definitely a plus and much needed ammo in your trading arsenal but just like any DD gathered I take it with a grain of salt .
More bidders = bullish. But when bidders are filled, the Time and Sales box shows red numbers. So how is this bullish?
Watched this video Saturday 2/12/2022 as I am learning level 2. Bohen is the man!!!
Opened my eyes about level II.
I do have it and use it but I dont find it extremely helpful. I'm looking at it harder to see if there is something else I can take from it. The chart and price action tell me what I need to know.
Just learning it. Seems like Tim uses it consistently. I'm just trying to understand it when it's moving.I guess maybe it's just something you need to know and understand si it can be in your toolbox!! Thanks
Less important. Time and Sales is more useful
What? Level two is everything.
Is you're Level two actually Nasdaq Totalview?
ehhh.. disagree. I felt this vid is more of a copy cat of everyone else that gives just enough to considering it as basics only education.
thx Tim you are a great teacher
Thanks Tim you are the best I always learn something from you.
Yes I always check out the Level 11, but I’ve just been focusing on the price. Now after your video, I’ll be looking at the bigger picture… instead of focusing on singular prices, I’ll step back and focus on which Way the herd is moving. Thanks 😎👍
Clears up alot thanks. 👍
Paul hear from Delaware still studying to be a millionaire student
Hey your that rude person who does not let anyone speak while you are in the roo.
Thanks Tim! Straight Gospel!
Waste of time. Should have named the video – What is LEVEL 2.
Level 2 is great for certain time frame and pattern like the morning panic dip buys
Great vid. You present an interesting counter-point to some who say Level II is the be-all end-all to read market trend/status. Question: If I want to pick up a large position (20k ? ) on a penny stock ( or any stock) is it better to put up a single order or is it better to buy multiple small lots
Good info TB
🎸🔊🎶 Awesome & Thanks for all these lessons !
Do you use level two quotes? Do you find them useful?