Hi Carl, wow another great post from you, and spot on. I watch the ISLD book in Qcharts now for fun and have noticed how rapidly the bids are pulled in a falling market... makes one begin to appreciate the role market makers play. I do not scalp, and trade using "pokey" Waterhouse; it of course would be completely absurd to try to scalp using a traditional online broker.
I know that many people, me included, are annoyed with the term daytrader since it lumps a whole bunch of people together. Scalper is a great term for folks who are using direct access systems and who concentrate on Level II, looking to beat the spread and possibly do a bit better. I consider myself a short term directional trader. I do not use Level II, but look for chart patterns (5 min.), and always use limit orders; I will only pay "my" price. Since I hold for a day, and often overnight, I consider myself a daytrader, but certainly not a scalper. That should always be the distinction I believe when people introduce themselves as daytraders.
Your point about scalpers not trying to scalp scalpers and daytraders not trying... is right on. As I've often said I will give up the spread a half dozen times in a row before the position feels right (an extreme example but you get the idea) and then I run with it... to the scalper that is absolute heresy (or gravy if he's on the other side from me) but I don't give a rat's ass cuz I'm looking for a several point move. I'm adding liquidity by being blase about the second to second action, but that's just easy pickings for any scalper.
The most amusing orders are the retail market orders at the open... that's when you see some crazy stuff being executed, and I imagine the best time of the day for the direct access people... whereas folks like me using the webBroker often enter much later (20-30 min.) in the day when price comes in and acts very regularly. We can also be assured of a timely confirm later in the day since the first and last half hours are the badlands in terms of getting timely confirms for those of us using the molasses brokers. And without a confirm you can't offset (though you've been executed) and that can be absolutely disastrous as I've learned on several sad occasions.
~Smart$ |
