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Brandon:
This sounds fascinating. I would love to watch someone daytrade using level II.
Your advice to go to the next order below the current is a great
technique--meaning, I want out, get me out. The difference in going to that next
order is meaningless if it means you are out. That's like looking at the screen
when day trading SPs or Bonds after a surprise and seeing a position running
against you. Many traders sit, hoping the market won't hit their stops [some
even cancel their stops, hoping the market will turn back their way]. I find the
moment when you feel the market has moved against you, in an unexpected fashion,
do what you have to do to get out. Somehow, if you wait for prices to get
better, they never seem to. So, as you pointed out, if you want to get out, make
sure you are out. Then you can concentrate on the next trade.
Thanks for the fascinating insight in Level II...I'll have to find a way to see
Level II traded.
Best,
Tim Morge
brandont wrote:
>
> I use the ECNs and SelectNet all day long. I primarily use Island.
>
> It has been my experience that orders that are only partially filled remain
> open orders, allowing the remaining shares to be fill when the market comes
> back to your price.
>
> The only exception to this is when you are buying on the offer, or selling
> on the ask. In such cases the ECNs will match your order with anyone on
> there book willing to take the other side of your trade at the same price.
> But only up to the number of shares being bid or offered.
>
> In fast moving markets, and in volatile stock (i.e DELL, MSFT, NCSP) if you
> find yourself on the wrong side of the market the best bet is the SelectNet
> (USING THE PREFERENCE OPTION, NOT BROADCAST) one of the Market Makers a
> 1/16th away from the prevailing bid/offer. It will cost you $62.50/1000
> shares in slippage, however that is typically better than reentering order
> as a stock moves against you 2-3 points in 2 minutes.
>
> One other tip- The large Market Makers such as GSCO, MLCO, SHWD, MASH, NITE,
> PWJC, will typical except an order 2-3 times what the are showing, as long
> as you get to them early. Don't wait till they are the last one the
> bid/ask!!!
>
> Hope this helps in some small way,
>
> Brandon
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