| The Level II quote screen allows you to see how the bid and ask are comprised. It identifies market makers and the number of shares they are willing to buy or sell at a particular price. Day traders use this information to identify short-term support and resistance levels for Nasdaq stocks. Unfortunately, these price levels can be easily misinterpreted. Market makers do not always display their entire trading strategy on the screen; orders are often entered in small increments to get the best price. In addition to the market maker screen, time and sales information and real-time charts are provided in most daytrading software packages. The most popular Level II trading system is RealTick, developed by Townsend Analytics. Most brokers charge $250-$350 per month for the RealTick data feed or equivalent service. If you trade frequently, these charges are often reduced. A.B. Watley offers free Nasdaq Level II quotes with a $10,000 minimum opening balance. |
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