In plain language
Tape reading is the reading of the sequence of completed transactions. The old ticker tape carried prints; modern tools show time and sales with price, quantity, and time.
What it observes
Readers examine pace, repetition, size, crossed prices, and the relationship between executions and movement. Aggressor side and grouping depend on feed methodology. Wyckoff tape reading develops the historical approach.
Trades, quotes, and book
Prints show what executed. Quotes show current proposals; an order book adds depth and order updates. A time-and-sales feed from one venue does not necessarily represent other markets, hidden liquidity, or cancelled orders.
What it does not prove
The tape does not automatically reveal a participant's identity, motive, or total position. A fast sequence does not prove manipulation or future direction; it is evidence of observed executions that needs venue, data-quality, and price context.
Sources
- NYSE, Real-Time Data — Distinguishes trades, quotes, order-by-order depth, and auction-imbalance feeds.
- CME Group, Market by Order (MBO) — Shows the details an order-book feed adds beyond price-level aggregation.
- Nasdaq, BX Options Depth of Market specification — Distinguishes printable execution messages used in time-and-sales and volume calculations.