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THE MARKET WHISPERER 26 5

increasingly elaborate, the market depth exercises dissipated, and all the

books on that subject were sent to paper recycling. Market makers can
rout their orders exactly the way any trader can through an ECN, so that
you will never know who is on the other side, and any attempt to try and

understand the other side’s ‘methodology’ of actions is doomed to utter

failure. In short, do not waste your time on this: time is too precious.
Focus on the quantity of buyers and sellers, and the market depth as
displayed in actuality, and just accept the fact that it is rarely the full range

of information concerning true depth. Look for reasons in the shape of a

large seller renewing stock, give the seller a few seconds or minutes, try to

understand if that seller is about to disappear, and then make an informed

decision.

Varying layers of colors
As noted, each layer of color represents a different price level. When the
first layer representing buyers is broader than the first layer representing
sellers, there are more buyers than sellers. Note that a larger quantity
of buyers does not necessarily mean a larger quantity of shares, but the
larger the quantity of different buyers and sellers, the better the market
depth is, since the supply or demand are divided among a large number of
traders. If you were considering selling, what would you prefer to see on
the buyers’ side: a single buyer, buying a large quantity of shares, or three
different buyers simultaneously purchasing that same quantity? I would
prefer the latter: the division among multiple buyers is better than one
single buyer.
The purpose of these colored layers is to allow you to catch, at a glimpse,
a visual image of the pressures felt by buyers and sellers. Over time, the
changes in color will be an inseparable part of your overall awareness over
the strength or weakness of a stock at any given price.

5 – The T&S Window – Time & Sales

The Time & Sales window is a separate part of the attempt to understand a
stock’s direction. Some time ago, I invited a friend with a year’s experience
in trading to sit with me during one of my trading sessions. He was a
little amazed that alongside each stock box, I always positioned the T&S
window. I was equally amazed to hear that until now, he had never used
it. After spending a short amount of time with me, he realized its need.