20/01/2024
Wyckoff in ‘Studies in Tape Reading’
Tape Reading is rapid-fire horse sense. Its object is to determine whether stocks are being accumulated or distributed, marked up or down, or whether they are neglected by the large interests. The Tape Reader aims to make deductions from each succeeding transaction – every shift of the market kaleidoscope; to grasp a new situation, force it, lightning-like, through the weighing machine of the brain, and to reach a decision which can be acted upon with coolness and precision. It is gauging the momentary supply and demand in particular stocks and in the whole market, comparing the forces behind each and their relationship, each to the other and to all.
A Tape Reader is like the manager of a department store; into his office are poured hundreds of reports of sales made by various departments. He notes the general trend of business – whether demand is heavy or light throughout the store – but lends special attention to the lines in which demand is abnormally strong or weak. When he finds difficulty in keeping his shelves full in a certain department, he instructs his buyers, and they increase their buying orders; when certain goods do not move he knows there is little demand ( market ) for then, therefore he lowers his prices as an inducement to possible purchasers.
