Well Bid/ Well Offered

 

In this market environment we have to use all the tools we have to identify and maintain our edge in trading. One tool used in maintaining our edge is identifying well bid and well offered areas in the direction of the order flow in your stocks. Well Bid/Well Offered refers to inta-day institutional activity were you can expect buying or selling to occur once a specific level has been broken. This tool works especially well with strong stocks with weak opens (looking for well bid) and vise versa weak stocks with strong opens(looking for well offered).
 
 These areas are fantastic because they provide reference point were you can identify potential momentum moves and offers a clear level were you can manage risk. One of the problems that traders have is using this tool without putting it into the bigger picture/higher time frames.  By no means should this tool be the sole reason you want to be long or short a stock, but should be used as another building block to help you fine tune your trade scenario in a market with lower expectation of follow through.
 Charts

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