Not advice Educational reference only — nothing here predicts a price. What the measured outcomes are · Sources
← Volatility & statistics

Level 2

L2defined

Real-time order book data showing the bid and ask prices and sizes waiting at multiple price levels — market depth rather than a chart overlay — used to gauge near-term supply and demand.

What the numbers mean

depth: top 5 or 10 price levels

No period to set — the display shows resting bids and offers at each price level, with depth controlling how many levels are visible and which venues are aggregated.

  • Top 5 or 10 levels — how much depth is displayed
  • Bid / ask size — the shares resting at each price
  • Aggregated or by venue — whether market makers are shown separately
  • No period at all; it is live order data, not a calculation

How it is used

Used by short-term traders to see where size is resting and how quickly it refreshes, as a read on immediate supply and demand around the current price.

  • Large resting size at a price → a level that may hold, if it is real
  • Size pulling as price approaches → it was never real
  • Rapid refreshing of the bid → persistent buying interest

How it relates to everything else

Level 2 is the only tool here that shows intent rather than history — everything else on this page describes completed trades. That said, it shows only visible orders, and hidden and flashed size make it the easiest display on a trading screen to misread.

  • Shows resting orders; every other indicator shows completed trades
  • Read with time and sales, which shows what actually executed
  • Large participants deliberately hide or flash size

What to watch for

The book shows only visible orders and changes in milliseconds; large participants deliberately hide or flash size, so depth is frequently a misleading picture of real intent.