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Strategies & Market Trends : DAYTRADING Fundamentals -- Ignore unavailable to you. Want to Upgrade?

To: Eric P who wrote (8223)	5/5/2000 12:06:00 AM
From: Threei	Read Replies (2) \| Respond to of 18137

Eric, I am glad you suggest extended discussion on this topic. Somehow it doesn't get attention it deserves, meanwhile changes are imminent and their effect won't be insignificant. I would add that the spreads for stocks should be expected to increase It feels right. Besides, we are probably going to see (at least on the first stages) more chaotically changing spreads. Conversely, the 'fake' market makers will be forced to cease and desist. They will no longer be able to post 100 shares and sit on the inside ask for extended periods of time. With the new system, their 100 share offer will be quickly eaten up, and they will be automatically booted from the inside ask. Is there anything that would keep MM from immediate posting new 100 shares quote at the same price, essentually doing the same thing as they do now? I understand that it should be a little bit awkward but still? Besides, it's probably not too hard to automatize. I haven't found so far any obstacle to this. This is a plus for the trader, as their success and failure will be more dependant on their trading ideas and less dependant on their execution choices and finger speed. This is what seems to me the most unclear thing in this whole thing... What I am going to say is probably going to cause negative reaction from many. But intuitively I perceive upcoming situation differently. It seems that fast fingers role is going to increase under new rules. Today we have three factors determining trader's speed: generating of trading idea (or may be it would be more correct to say, recognizing of situation), identifying of the best route, finger's speed as such. Tomorrow second factor is out and fast trigger has shares while not that fast doesn't. Today second factor gives some advantage to trader who generates idea first because it feels intuitively like one who has good execution technique haven't got it out of the air... he probably still started with learning of strategy and came to learning of executions. And, being good at all those factors he has advantage over the one who is good at one or two of them. Anyway, if markets are going to move faster like we seem to feel as of now, faster fingers are still going to be of importance, and probably of increased importance. Or, may be I am overcomplicating this... Just want to be as ready as possible. Thoughts, folks? Vadym