Online Trading Academy has put together a manual to teach investors how to electronic trade the NASDAQ using the now popular Level 2 screen. This manual is designed to get right down to business and is followed closely in our Professional Trader courses. This manual will not sell you on the concept but more so on the actual techniques involved.
There is no fluff in this manual. It’s simple, straightforward, and to the point. Keep this guide next to your computer and have it handy. You will refer to it on many occasions to keep you on track. One reader gave us feedback about the downloadable version: "Thanks for the quick reply. I have received the [electronic manual] and I can read it with no problem. It´s a great idea... Thanks again, N."
Another customer recently sent us these comments: "Rating: Excellent. Comments: Prompt, no hassle, courteous service. Thanks!"
Table of Contents
Introduction to Trading
I. Trading on the NASDAQ System
Definition
Basic Terminology
Dealer vs. Auction Market
SOES
SelectNet
Electronic Communication Networks (ECN’s)
NASDAQ Trading Skills
II. Market Awareness
History of Day Trading
Gaining Market Awareness
What Markets to Watch
Homework Time – Getting to Know Price Levels
Checking Headlines
Different Market Indicators
III. Charting and Price Movements
Technical Analysis Defined
Technical vs. Fundamental Analysis
Intraday Price Movements on the NASDAQ
Direct Access Trader Chart Basics
Recommended Charts
Popular Chart Patterns
IV. Using NASDAQ Level II To Your Advantage
Advantages of Level II over Level I
Analyzing Short Term Risk through the Market Maker Window
Observing Market Maker & ECN positioning
V. Order Placing
Timing your Entry & Exit to get the Best Possible Price
When to use what type of Order
The power of ISLD (CIN)
VI. Short Positions
Definition
The NASDAQ Short Sale Rule |
VII. Risk Assessment & Management
VIII. Common Trading Styles
Developing your Trading Style
Scalping
Trend Trading
Multiple Positions
Overnight Positions
IX. Preparing for Live Trading
Demo vs. Live: A world of difference
The Right Way to Trade on Demo
Practicing Trading Scenarios
Establishing Realistic Short-term Goals
Beginner Trading Scenarios
X. Important NASD Rules for the Direct Access Trader
5 minute SOES Rule
10 Second SelectNet Rule
NASDAQ Short Sale Rule
Out of the Money Bids and Offers
Appendices
Appendix A: Training Course Calendar and Agenda
Appendix B: Common Trading Mistakes
Appendix C: NASDAQ Market Makers
Appendix D: Electronic Communication Networks (ECN’s)
Appendix E: NASDAQ 100 List
Appendix F: Reading & Reference Material
Appendix G: Trader’s Slang Glossary
Appendix H: Financial Terminology
Appendix I: Standard & Poor’s 500 Index (SPX)
Appendix J: NASDAQ Circuit Breaker Rules
Appendix K: Daily Trade Sheet
Appendix L: Execution Platforms
Appendix M: Margin Requirements | |
