Millionaire Traders

JWBK169-Lien July 3, 2007 13:56

Millionaire Traders

A: Yes, Level 2 entry. Most important is immediate fills. You are

not giving your order to a specialist. Everything is done right away.

Watch the book, watch where all the bids and offer are on Level 2.

On the NYSE it’s not easy to do that. There is less transparency.

Q: Is mostly what you do these days tape watching, or are you a

chart reader as well?

A: No. I watch charts too, but I would say Level 2 is primary.

Charts are for confirmation. If the chart looks good, but Level 2

isn’t there, I won’t trade. But if Level 2 looks good, but chart is

shaky, then sometimes I will trade even if the chart is not good.

Q: What timeframe charts do you look at?

A: My screen. What I am looking at right now is Level 2. One

that I trade off of and seven others that I am watching. The Level 2

that I trade off of is linked to two charts: a five-minute chart and

a daily chart. I also have five-minute charts of S&P, Nasdaq, and

E-mini Russell futures, and I have daily charts of indexes. But what

I am really watching is five-minute charts, and I also have the S&P

squawk box just for the general tone of the market.

Q: Can you give an idea of the type of stocks you are trading?

A: I am trading stocks priced between$30 to$70 with average

daily volume of 300,000 to 1 million shares.

Q: So these are intermediate stocks—not extraordinarily liquid,

but liquid enough. How large a size will you go into stock that

trades 300K a day?

A: My size can vary from 100 to 5,000. But usually it goes between

100 to 2,000 shares. It depends on the day and what is going on in