This article describes the „market maker“ and „time of sale“ (T.O.S.) screens as well as the stock „ticker“ screen. The market maker screen will help wiih 2 things:

1. To determine which stocks you are willing to trade, and therefore which stocks you want as part of the ticker of stocks that you follow.
2. To aid in timing the best moment for entering and exitinc trades that are described in the 5 minute and daily bar chart setups.

The time of sale (T.O.S.) screen is used in conjunction with the market maker screen for timing trade entry and exit.

The „ticker“ is the screen loaded with the stocks you have chosen to follow. This is the screen that immediately shows if a market maker has changed his bid up or down for one of your stocks as weli as when the inside bid or offer has changed and whether it was tip ordown in price.

You will have your market maker, T.O S., daily chart and 5 minute chart screens all linked together so that when you type in a stock symbol, all of this information for that particular stock immediately pops up on your computer monitor. By watching the ticker scroll along, you are immediately alerted to a stock's uptick or downtick (usually color coded) and can then quickly type in the stock symbol to access the market maker, T.О.S, daily and 5 minute bar information. These are the 4 screens thai are used in conjunction to find the price pattern setups and to time your trade entry and exits.

MARKET MAKER SCREEN

This screen shows you the current „inside“ hid and offer (or ask} price for a stock. It also shows you how many market makers are bidding and offering at each price level. You will see the other bid/offer price levels as well. The difference between the bid and ask price is known as the „spread“. You will be looking for stocks that regularly have 1/8 spreads. Some 1/4 spread stocks may also be tradable. Also, you want the number of market makers at each price ievel to typically be 4 or more. The more „depth“ per price level, the safer that stock is to trade. Avoid stocks with 1 – 3 market makers per price level. These thin price levels can quickly cost you much more than a 1/4 loss if you are wrong about the trade.

• Before entering a stock long or short ask yourself this question: "If the market immediately reverses against me when I enter the trade, what is my probable exit price?

This means if you buy the inside ask on a stock to go long, look at the price and depth on the bid side to determine where you are likely to get filled if you have to exit the trade right away, if it is for more than 1/4 point (or in some cases 3/S) loss, then pass up that trade setup. Another one will come along later. Each stock has its own personality with how the market maker screen moves.

T.O.S SCREEN

This screen shows actual trades, the time, the number of shares and the price. If you have a trade pattern setup, look at the T.O.S screen flow of orders to see if they are being filled at the bid or at the ask. If you are jet up for a trade to the long side, look for trades coming through at the inside ask price of the market maker screen to help you time your entry. Also, the inside price level of market makers will start to move up. This is especially true if you see 1000 tot traces coming through the T.O.S. screen. These are other computer day traders that are buying the stock and help assist the momentum into the upside move. The reverse scenario is true of a downside move.

Together the market maker and time of sale screens are fundamental to help you time vour entries and exits for the best trade setups. Only actual experience will enable you to hone this ability. This is why „paper trading“ is very important initially. But remember, the actual timing is learned when you begin „live“ trading. This is why I recommend using only 500 share trades when you first start with real money. 500 shares cuts your „tuition“ in half as you first learn the typical fill time and price for each stock under varying market circumstances. „Live“ tradine is very different from paper trading when it comes to actual entries and exits (and actual dollars won or lost).

Have the „big 4“: the market maker, T.О.S., daily, and 5 minute screens viewed together on your computer monitor for each stock that you type into your keyboard. This will provide all of the information needed to execute and manage the best trades.

TICKER

This is the screen which contains your collection of stocks that scroll through with any bid or ask adjustments up or down by a market maker. It also shows when the inside bid or ask has changed. As mentioned earlier, your group of stocks are chosen based on several factors. Look for average volume of at least 100,000 shares per day. These stocks should have only 1/8 point (and occasionally 1/4) bid/ask spreads on the market maker screen. In addition, the market maker screen should typically have an average of at least 4+ market makers per price level. Also, consider the daily and 5 minute charts to see if the stock provides the daily am intraday price setups from this manual which regularly follow through with the setup's trade expectations. Look for stocks that often show good daily price range or movement on a regular basis. This means setups with an opportunity of a 1+ point move during the day.

Your ticker may contain as manу stocks as you can reasonably follow. That may mean 60, 150, or 200+ stocks. Be aware that each stock does have its own price movement and market mакеr T.O.S. screen personality. Be aware that each stock tends to cycle in and out of a „trader-friendly“ mode. You can always add or delete stocks from your ticker to keep it updated.

SUMMARY

Tying together the daily and intraday price pattern setups with the learned liming of the market maker and T.O.S. screens are essential to your success. Leave one component out and you reduce your odds for even the best price pattern setups. Only through experience with your universe of stocks will you improve your bottom line. This is the art of trading.