Day Trading Indicators
Level 1 Definition
Level 1 is the real-time bid/ask quotes for securities trading on the Nasdaq and Over The Counter (OTC) Bulletin Board Service. Level 1 is broken out into 5 key components: (1) Bid Price, (2) Bid Size, (3) Ask Price, (4) Ask Size, and (5) Last Price.
Tick Charts Definition
Tick charts display a certain number of trades before printing a new bar chart. Unlike other charts which are based on time, tick charts are solely based on trading activity. Tick charts are a favorite for day traders
Market Scanner Definition
A market scanner is a vital component to any day trading strategy. Successful day trading comes from trading the most volatile stocks in the market. Since day traders have only a few hours per day to trade, it is best to focus on a limited number of stocks. Thus, market scan
Trade Volume Index Definition
The trade volume index (TVI) detects whether a security is being bought or sold based on tick data. The TVI provides a trader more insight into the amount of buying and selling for a security. It tracks the total volume that occurs at the bid and ask. So,
Level II Quotes
Level II provides the data for pending orders in the market. It displays the size of the best bids and offers with their respective depths. Day traders use level II to gauge the direction of the market over the short-term.
What do I need to get started with Day Trading?
Not only will you require a solid approach or technique to day trading, but the day trading computer equipment needs will be just as important when setting yourself up to day trade.
What is the Time and Sales Window?
From my experience in day trading over the last few years, my most valuable tool became the time and sales window, aka. the "Tape". The time and sales window basically shows the trader detailed information regarding the order flow for a particular security.
Absolute Breadth Index Definition
The absolute breadth index (ABI) measures the amount of volatility on the New York Stock exchange.
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