Time and sales (the tape)
Time and sales, often called the tape, is the running list of trades in a stock as they happen, each with its time, price and number of shares. Reading the tape means watching that list to judge whether buyers or sellers are in control right now.
Why it matters to a small-cap momentum trader
A chart summarises; the tape shows each trade. When prints hit the offer faster and larger, buyers are paying up; a run of prints at the bid means sellers are hitting it. Momentum traders watch the tape speed up as a stock approaches a level, and watch a large offer on Level 2 get taken out print by print. A tape that goes quiet at a high is often the first sign the move is tiring.
How it is read
Colour. Each print is usually coloured by where it traded against the quote at that moment: at the offer or above it, buyers paying up; at the bid or below it, sellers hitting it; in between, inside the spread.
Size and speed. A run of small prints and one large block say different things, and so does a tape that suddenly speeds up.
There is no rule behind the tape. Reading it is a skill, and it is learned by watching.
Time and sales in Hindsight Markets
Time and sales shows that day's exchange prints in order as the replay clock reaches them, each coloured by where it traded against the quote: at the bid, at the ask, inside the spread, above or below. Slow the replay to half speed to practise reading it, or watch a trade you took again with your own fills drawn on the tape.
A worked example: colouring five prints
An illustration with made-up numbers, not a real stock or a real day. The quote is 5.00 bid, 5.02 offer.
| Where it traded | Usual reading | |
|---|---|---|
| 5.03 | Above the offer | A buyer paid up through the offer |
| 5.02 | At the offer | A buyer took the offer |
| 5.01 | Inside the spread | Neither side gave way |
| 5.00 | At the bid | A seller hit the bid |
| 4.99 | Below the bid | A seller sold through the bid |
A print above or below the quote often means the quote changed in the instant of the trade, so a single one proves little. A run of them in one direction says more.
Common mistakes small-cap traders make with the tape
- Reading one big print as a big buyer. A block can be a cross between two parties or a seller getting out. What follows it matters more than the print.
- Trying to read every print on a fast open. At full speed the tape is a blur. A minimum size filter or a slower replay makes the pattern visible.
- Ignoring the book. The tape shows offers being taken; Level 2 shows how many are left. Each needs the other.
- Forgetting what is missing. Trades executed off the exchanges reach some tapes and not others. Know which prints your tape shows.
Common questions
- What do the colours mean in time and sales?
- On most platforms green is a print at the offer, a brighter green above it, red at the bid, a deeper red below it, and grey or white in between. The colours can usually be changed, so check your settings.
- How do you read time and sales?
- Watch the colour, the size and the speed together. Prints coming faster and larger at the offer as price nears a level suggest buyers are pushing. A burst at the bid, or a tape that goes quiet at a high, suggests the move is tiring.
- Is tape reading still useful?
- Yes, especially on small caps, where a few traders move the price and their urgency shows on the tape. On heavily traded large caps, much of the flow is split into small automated orders and is harder to read.
- What is the difference between time and sales and Level 2?
- Time and sales is the record of trades that have happened. Level 2 shows the orders still waiting. The tape tells you what traded; the book tells you what is left.
- What counts as a large print?
- It depends on the stock. A 10,000-share print is large for a stock that trades a few hundred thousand shares a day and routine for one that trades tens of millions. Judge size against the stock's own normal.
- Why are some prints marked differently?
- Some trades carry conditions: odd lots under a round lot, late reports, or auction prints. Many platforms mark or hide them, because odd lots and late reports do not set the last price.
How to practise it in Hindsight Markets
- Open a past day and pick a small cap that ran, from the Small Cap Low Float Top Gainers scan.
- In the tape settings, set Min size to hide the smallest prints and Block ≥ to highlight the large ones.
- Slow the replay to half speed as the stock nears its high and watch the prints at the offer.
- Put Level 2 beside the tape and watch a large offer get taken, or pulled.
- After a trade, watch it again with your own fills drawn on the tape.
Practice this on a real past day in Hindsight Markets
Replay a real small-cap run at half speed and practise reading the tape before you put money behind what you see.