Let me start by saying that I have no idea who authored Ticker Technique: The Art of Tape Reading (Traders Press, 2005). The book was originally published in 1965, but its focal point (part two of four parts) is an updated version of Orline D. Foster’s 1935 Ticker Technique. The other three parts expand on tape reading and include contributions by Herbert Liesner and Don Worden. Whoever the author was, he/she helped keep the tradition of tape reading alive and well.
Foster’s piece is only about 25 pages long, but it is both a first-rate introduction to tape reading for the novice and a quick refresher course for the technical trader. He writes about price, volume, breadth, and timing, all within the context of accumulation and distribution.
I’m not going to rehash the ideas presented in this book. If you’re familiar with them I would bore you; if you’re not I would lose you. Let me simply say that if you’re short on bookshelf space, you could most likely profit from replacing almost any of your more recent trading books with this one.
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As far as purely discretionary trading techniques go, tape reading is the only one I've been able to do. However, the concentration and focus required is enormous... making money by staring at second-by-second order book changes is a dreary existence... good stuff to know, but I find studying markets and developing strategies far more rewarding..
ReplyDeleteAlso, Brenda, if you receive the emini futures data, take a look at the order book some time.. you'll probably see larger orders seemingly fill quicker than 1 lot orders do, as per your previous post.