Level 2 stock data shows all of the orders that have been placed at prices below the best bid price or above the best ask price. These are limit orders that could be executed if the price of a stock were to fall or rise. Level 2 data is also known as order book or market depth data because it reveals the full range of existing orders for a stock.
What is Level 2 trading?
Level 2 trading provides traders with a wealth of information beyond just the bid and ask prices, offering a deeper insight into a stock’s order book. In this comprehensive guide, we will demystify Level 2 trading and explore its features, benefits, strategies, and answer some frequently asked questions.
What is Level 2 market data?
Level 2 market data shows the price of the quote offered by each market maker. These bid and ask quotes are below and above the current national best bid and ask prices and are shown at regular intervals. For example, if a stock’s national best bid price is $10.00, Level 2 data may show quotes at $9.90, $9.80, $9.70, and so on.
