DislikedThank you.
Have you traded on the pit or did you already used computers?
How hard/easy it was for you to make the change(if you where trading on the pit)
How do you live the difference between both? I mean: on(at?) the pit, I believe you can "feel" the sentiment live at screens you just see the movement. Can you tell me about it ?
If i´m asking too much just say, if you don´t like to share this in public you can pm me.
Red.Ignored
Trading in the pit is very different. First you see the order flow. Most of the time you are trading with the brokers who are filling customers orders. So you get a feel for the order flow very quickly. In addition you see and hear the size, and see the reaction of the market to the flow. For example if you see large orders being filled easily, you can quickly get a feel for how the market is positioned. I remember once, when I was starting out, I left the pit for a min. When I came back, a broker was offering a large order at say 103.00. The locals where all bidding just below at 102.00. I found it odd that they where not leaning on it, ie offering ahead, say 102.90 or lower. Just as this thought hit me, I bought a few cars from the broker at 103.00. The place went up for grabs, lol, the bastards where all short, trying to wait the order out. But when I bought a few, a trickel effect followed, and everyone jumped ship, within seconds I was selling 104.00 ,lol. Not a big score, but a good lesson.
In addition in the pit, we where the house. I paid the bid, and sold the offer, not all the time, but most of the time. This gives you what they call in statistics a positive expectation. If the market is 103 bid at 104, the fair value is 103.50, so I automaticly have an edge. Lots of times I would trade, not because I had an idea, but because I had the edge.
Another thing, is in the pit, most locals scalp, ie trade for ticks. In and out, all day, hundreds of trades sometimes. But many times you get situations where you put a trade on for a tick, and something happend and now your looking at 10 ticks. Pays for a lot of losses. There are a good amount of traders, myself included the would swing trade intraday, looking for good sized moves.
And then there are the stops. Well I'm not going to say much about stops. But I will say this. When your in the pit, the market, on a very small time frame, is much like a rubber band. Lots of times, if I figured that stops where being run, or if I felt the market had moved or streched out because of stops, I would fade those stops 9 out of 10 times, even if it was for only a min or two.
So yes, it was very different from the screens. I was down there when the volume started shifting. Lot of guys could not make the transition, the differences where too big for them. But many guys just turned on the computers and kept on cooking.
Instinct is big down there, so is feel. I watch this euro all day, and there are so many times when I see it move, where if I was in the pit I could have traded that move, but not on the screen. I am no longer the fastest gun in the west, lol. That title belongs to others now.
To me a market is a market. Doesnt matter if it Euro's, corn, oil, or bunds, or carbon emissions. What does make a difference now is if I can make money trading it. Hope I answered some of your questions, you see I've had a few cocktails....PTL
Look Sharp/Trade Tight
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