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Message: Re: Action today was odd...(paylslyone)

Jun 15, 2009 04:03PM
2
Jun 16, 2009 04:36AM
1
Jun 16, 2009 04:54AM
1
Jun 16, 2009 09:56AM

You have a hard time understanding my posts i think.....i never changed my tune. I have also stated the same thing. please follow along.......

I have stated and please pay attention when the L2 discussion is going on. I will give you the three scenarios again.

1. MM on the bid and ask. if the MM is the highest on the bid and the highest on the ask. He needs not to take a position. Already made this very clear. The MM can see the share count on both the buying and selling and there is no need to take a position.



2. MM on the BID - the MM is collecting shares , he is getting this shares to fill a future order. He sees the demand of shares and collects at this SP.



3. MM on the ASK ( not on the bid) - MM is selling shares. MM believes he can fill this order on the way down... instead of the way up.



MMs will compete against themselves.... this prevents MMs from taking exposing themselves into taking uneccessary positions.



If you have watched PTSC L2..... i would say 90% of the time. NITE is on the bid and ASK. Very few times does a MM stick on one side of the orders. If he does... (eg. Appears on BID at .14 you will see him later in the day move off the BID and sit on the ASK at .145 or .15 now selling the shares he held).

My arguement is that MMs dont hold shares for indefinte periods and manipulate the Bid/ASK just to holding stock in order to sell and make $$ on the positions. Its way too risky and the competition of MMs would prevent any MM from really trying to do this.

Look at today for example. UBSS and NITE are on the ASK at .135 and the NITE is on the bid is .1275 Depending on the share count available on the ask... if orders are going through... more than Likely UBSS will move off the ask at .135 after taking some orders..... and then move up the BID from where they are standing at .125 to .13 ( they can now fill the order they "sold" at .135 ) and still made .005 money on the spread.

If the ASK moved down.... then UBSS could stay at .125 and fill the "sold" order at .135 at .125 and made a nice change at .01 spread.



The big spreads allow the MMs room to fill the orders when the direction of the sotck moves in either direction.

NITE could put the pressure on the UBSS..and raise the BID to .1375 and then the ASK to .1475 . UBSS must now sit on the bid and fill a .135 order (at .1375) now a loss of .0025 UBSS will now be aggressive on the bid and ask because he will need to make up for the loss.... filling orders on the bid and ask he then recoups by making gains on the spread taking a balanced positions.





"This is a flat wrong statement… if the BID is .14 and the ASK is .15… a sale goes through at .15 is it buy or sell???? (Answer) it could be a buy or a sell… If you disagree with this then we will not continue this conversation……."



I guess you still dont understand what BID and ASK are? a Transaction that goes at .15 is a "sell" for the MM and a "buy" for the Joe Trader. Very simple. I have no idea what your trying to say that it could be a buy or sell? The MM does not "buy" at the ask..... if you cant understand this... you probably shouldnt be trading..



Again regarding the after hours trading.... i didnt see any trades last night... maybe tonight lol..... im looking buddy....




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