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Strategies & Market Trends : Level II Trading -- Ignore unavailable to you. Want to Upgrade?

To: ExCane who wrote (119)	2/8/1998 8:39:00 PM
From: Leland Charon	Respond to of 1086

Alex, I too have access to Level II although I do not believe that it is the holy grail. I do know who the big MM's are in the stocks that I normally trade and like to keep track of where they are before buying or selling. I do not believe that one can be successful buying and selling just based off of Level II action. The MM's are a very intelligent group and can outsmart even the most senior traders. Leland

To: ExCane who wrote (119)	2/9/1998 1:24:00 PM
From: Robert Graham	Read Replies (3) \| Respond to of 1086

Yes, I agree with you that attempting to "read between the lines" of a Level II is generally not profitable. This is in part what I was referring to in my previous post. I referred to the intraday "noise" to trade off of which this following the bid and ask machinations by the MM I consider to be a part. I can see day traders being profitable in relation to liquidity, market trend, and established strong momentum in a stock, but I find it hard to believe that many are being profitable by scalping the random (unpredictable) gyrations of stocks which the MM activity adds another misleading component to. Has anyone found this to be different who is actually profiting from this approach with Level II? When DRDISK came up with the words like "easy" and other exhuberant words, where "predictable" was another word that was implied, to describe trading using the Level II service is normally very revealing of where the trader is coming from. This is in part was the focus of my response. I did not know he was a SOES trader, so this is my mistake. DRDISK did take my feedback to him better than I expected that he would, which is to his credit. But I still am skeptical about any given person being able to make money in this way. I believe in probabilities as a tool to evaluate some of what is presented to me in my daily life and have not been mislead too many times with this approach. I will say that even though their are probably SOES players making money in this way, there are so few that are profiting that it is unlikely for me to meet lets say more than on the order of a handful here on SI that are actually profitable. What I think actually happens is their equity curve moves up and down like the "noise" they trade. Upon closer examination, their equity curve is moving down, not up. This allows them to fool themselves into a false sense of security and accomplishment as they are dying a slow financial death. But this is just a guess on my part. I am not suggesting that I understand what SOES trading is all about. I think it does not take allot of intelligence or observation or experience to see how this approach to trading can be a losing game for many if not most of its players. My concern is that others less knowledgeable and experienced than successful SOES traders, which I acknowledge may include DRDISK as a successful SOES trader, will get caught up in his exhuberance and look upon the SOES player's example and attempt to imitate the same thing for themselves, only to find to their horror eventual losses of large amounts of money they probably could not afford to lose anyway. I do think DRDISK did pick up on this concern of mine in my last post. Also I will make note here of the many reports that have come out, some from very reputable sources, that do indicate that the more aggressive SOES players, called SOES bandits, are a problem to MMs in particular situations. That is where the term being "SOESed" comes from that MMs use to describe their experiences with the SOES player. Perhaps this problem is not as wide spread as the MMs make it out to be. When I saw the report that described the SOES bandit who places in false bids just to quickly retract them in their attempt to cause movement in the stock, I did see this as an unethical practice that is not helping the other traders in the stock. This particular SOES activity reminds about the complaints I here about the MM and MM manipulation. I do not see any difference here in the intended purpose. How about if DRDISK goes through some of the practices he uses to identify what the MM is actually doing and how to profit from it? This should not be a problem for him. After all, DRDISK, isn't this the reason you have created this thread? I do sincerely acknowledge that you would indeed be a generous person if he were to spend some of your time educating us in this way. Your actions in this direction would also encourage others to share their experiences and move this discussion back to the main topic of your worthwhile thread. Just a thought. Bob Graham

To: ExCane who wrote (119)	2/25/1998 6:07:00 PM
From: Mama Bear	Read Replies (1) \| Respond to of 1086

>>>I'm not expecting anyone to give away their secrets, just whether it works or it doesn't. So far only one person has claimed to profit from the use of it. Anybody else out there? <<< I yutzed around until December, not wanting to spend the 300/month. Since my level II quotes were installed 12/9/97, my earnings have increased considerably. I fell like someone who was in a road race and had the blindfold removed. it is so much easier to drive when you can see the twists and turns of the road. Barb