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-   -   Trading against the herd (https://www.forexfactory.com/showthread.php?t=930316)

wiserltz Jul 9, 2019 9:01am | Post# 81

{quote} I would agree with you on that, this is what i think: The herd usually tends to start following the trend when there is a reversal about to come, i don't know why, but retail traders get stressed too much and somehow manage to do the exact oposite of the market 90% of the time. I think it's just human psychology, most people think similary and get scared of the market at the same time. Thing is, you can profit by both following the trend and going against it, but the herd always tend to have some ideas about stop loss hunting, about market...
one thing i wander, people always say bankers do care of peanut from retailers. if so why bother to trap the retailers?

thj79 Jul 9, 2019 9:28am | Post# 82

Yesterday Deutsche Bank let 18.000 Traders go. Would you kick profitable traders out of your company? Maybe they are not as good as we think they are ;-)

Vorenzd Jul 9, 2019 10:39am | Post# 83

{quote} one thing i wander, people always say bankers do care of peanut from retailers. if so why bother to trap the retailers?
@wiserltz

Let me explain this to you:

As a retail trader, liquidity is not a problem for you, you don't really think about liquidity. However when you are an institution with a huge capital liquidity is your biggest problem.

So lets make an fictive example:
we want to buy an equivalent of 1000 lots of NZD/JPY, we can't do this in one go, it will move the market too much, however the relevant department in the company has noticed that we are near a level where many traders have placed their stop loss (for example a support or resistance line). What the company would do is:

1.company would go in a counter position and push the price beyond the line thus triggering the stop losses and dropping/rising the price further

2.the company would close their counter position and open a position on the asset in it's originaly desired direction with a large order and move the market back in the other direction, the market would continue to move in the oposite direction suiting the company's position.

3. Retailers would get their stop losses triggered and wouldn't gain profits from the move they correctly predicted

This does not always occure, stop losses are important, don't forget to put them, these events don't happen that often, but they do happen. You can see them yourself.


You see, smart money DOES NOT care about retail investors, but rather their own interests, and if it's possible to get a better price by baiting a few retailers and triggering a few stop losses, then ofcourse we will do it.

It's not about trapping retailers, it's about securing yourself a better price.

Regards, Vorenzd.

Ill-b-back Jul 9, 2019 12:11pm | Post# 84

Yesterday Deutsche Bank let 18.000 Traders go. Would you kick profitable traders out of your company? Maybe they are not as good as we think they are ;-)
Increases in autotrading

Lekkim Jul 9, 2019 2:53pm | Post# 85

{quote} Increases in autotrading
Yes I agree.
Also 'traders' nowadays in banks, mostly just execute orders and care for clients.

Liarg Jul 9, 2019 2:58pm | Post# 86

Hi b-ack

so your saying that forexfactory members are losers huh hahah just kidding
i like the concept. Can I ask you? How fast and often trade data update you know? thanks

RegisMexes Jul 9, 2019 4:12pm | Post# 87

69% of FF members are bullish cable..

Marcieny Jul 9, 2019 4:23pm | Post# 88

69% of FF members are bullish cable..
let's see if they will have the courage to walk against the herd

neilsdigest Jul 9, 2019 5:11pm | Post# 89

According to myfxbook there are:

GBP/USD

Yesterday's close (New York) 39480.02 Lots long

Todays close 46116.18 lots long.

Plus 6,636.16 lots added today LONG

90% of 91,643 positions are long.

So retail clients do have enough postions for the big guys to just go the other way :-)
I will leave this thread alone though as no one believes me that this works and will always work, but doesnt it just make sense that if retail are 90% wrong MOST of the time to trade the other way and 90% of the time with the real trend?

Ill-b-back Jul 9, 2019 5:51pm | Post# 90

69% of FF members are bullish cable..
And in the GBPUSD thread, we have the usual bullish punters saying we will see 1.26 in 2 days or we are 100% guaranteed to see 1.25 or more this week (assuming not talking retrospectively about Monday).

With 69% retail herd long and this suicidal chatter going on, seems we are ripe for another drop to below 1.24.

4xu2 Jul 9, 2019 6:05pm | Post# 91

According to myfxbook there are: GBP/USD Yesterday's close (New York) 39480.02 Lots long Todays close 46116.18 lots long. Plus 6,636.16 lots added today LONG 90% of 91,643 positions are long. So retail clients do have enough postions for the big guys to just go the other way :-) I will leave this thread alone though as no one believes me that this works and will always work, but doesnt it just make sense that if retail are 90% wrong MOST of the time to trade the other way and 90% of the time with the real trend?
Haha, I've been waiting for you to show up! Yep they are (or I should say some) are catching on.

Ill-b-back Jul 9, 2019 8:42pm | Post# 92

{quote} @wiserltz Let me explain this to you: As a retail trader, liquidity is not a problem for you, you don't really think about liquidity. However when you are an institution with a huge capital liquidity is your biggest problem. So lets make an fictive example: we want to buy an equivalent of 1000 lots of NZD/JPY, we can't do this in one go, it will move the market too much, however the relevant department in the company has noticed that we are near a level where many traders have placed their stop loss (for example a support or resistance line)....
Thanks very much for your contribution Vorenzd.

Ill-b-back Jul 9, 2019 8:45pm | Post# 93

Hi b-ack so your saying that forexfactory members are losers huh hahah just kidding i like the concept. Can I ask you? How fast and often trade data update you know? thanks
I really just watch the values at the end of each trading day, but they are updated during the day. Not sure how often.

Vorenzd Jul 9, 2019 9:04pm | Post# 94

{quote} Thanks very much for your contribution Vorenzd.
My pleasure, I'm glad to have been of some help.

wiserltz Jul 9, 2019 9:44pm | Post# 95

1 Attachment(s)
{quote} @wiserltz Let me explain this to you: As a retail trader, liquidity is not a problem for you, you don't really think about liquidity. However when you are an institution with a huge capital liquidity is your biggest problem. So lets make an fictive example: we want to buy an equivalent of 1000 lots of NZD/JPY, we can't do this in one go, it will move the market too much, however the relevant department in the company has noticed that we are near a level where many traders have placed their stop loss (for example a support or resistance line)....
Thanks to clarify some misunderstanding.

Can I conclude: When retailers tend to long/short randomly, they will be ignored by institution; but when they line up for the same direction, like the case in GBPUSD, the lots are big enough and can not be ignored by institution, in other words, sometimes retailers can move the market? And majorty of the herd can be profitable sometimes.

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When there are enough sardines, sharks & penguins work together; if not, sharks hunt for penguins. And, wounded shark becomes prey.

SunnyCoast Jul 10, 2019 5:19am | Post# 96

{quote} {image} When there are enough sardines, sharks & penguins work together; if not, sharks hunt for penguins. And, wounded shark becomes prey.
I love this!! CIRCLE OF LIFE right there!!

Vorenzd Jul 10, 2019 6:10am | Post# 97

{quote} Thanks to clarify some misunderstanding. Can I conclude: When retailers tend to long/short randomly, they will be ignored by institution; but when they line up for the same direction, like the case in GBPUSD, the lots are big enough and can not be ignored by institution, in other words, sometimes retailers can move the market? And majorty of the herd can be profitable sometimes. {image} When there are enough sardines, sharks & penguins work together; if not, sharks hunt for penguins. And, wounded shark becomes prey.
Great conclusion, i love the comparison!

wiserltz Jul 10, 2019 7:23am | Post# 98

{quote} Thanks to clarify some misunderstanding. Can I conclude: When retailers tend to long/short randomly, they will be ignored by institution; but when they line up for the same direction, like the case in GBPUSD, the lots are big enough and can not be ignored by institution, in other words, sometimes retailers can move the market? And majorty of the herd can be profitable sometimes. {image} When there are enough sardines, sharks & penguins work together; if not, sharks hunt for penguins. And, wounded shark becomes prey.
sardines' stagety is simple: following nearby sardines, so they feel safe and protectd, and get killed.
sharks' stagety, a little compilicated: don't let fishes run DEEP INTO THE SEA, keep them near the SURFACE, no panic, just eat all of them

Ill-b-back Jul 11, 2019 1:09am | Post# 99

GBPUSD bulls now at 70%.

This bullish move can't last long...

Aussi Jul 11, 2019 1:45am | Post# 100

GBPUSD bulls now at 70%. This bullish move can't last long...
might get you wish on the 4hr chart mate

wiserltz Jul 11, 2019 2:28am | Post# 101

GBPUSD bulls now at 70%. This bullish move can't last long...
What percentage do you think the bear will be finished?

Ill-b-back Jul 11, 2019 2:35am | Post# 102

{quote} might get you wish on the 4hr chart mate
Hey Aussie. I'm not in the market yet, waiting to see what happens higher up.

Aussi Jul 11, 2019 2:37am | Post# 103

{quote} Hey Aussie. I'm not in the market yet, waiting to see what happens higher up.
i understand mate

Ill-b-back Jul 11, 2019 2:37am | Post# 104

{quote} What percentage do you think the bear will be finished?
No idea.
Simply looking at % and going against the herd as explained in my first post.
This is for experimental purposes only and is not how I approach trading.

wiserltz Jul 11, 2019 2:57am | Post# 105

GBPUSD bulls now at 70%. This bullish move can't last long...
Agree! In fact I think all the PA above 1.125 is fake

thj79 Jul 11, 2019 2:58am | Post# 106

What sources are you using? At the moment, I got these:

https://www.forexfactory.com/trades.php
https://www.dukascopy.com/swiss/deut...tch/sentiment/
https://www.dailyfx.com/sentiment
https://www1.oanda.com/forex-trading...osition-ratios
https://www.home.saxo/insights/tools...t/tool-details
https://www.fxblue.com/connect/#sentiment
https://www.myfxbook.com/de/community/outlook
https://fxssi.com/tools/current-ratio

What else can be used?

WhipKream Jul 11, 2019 3:13am | Post# 107

Oanda's open order book is updated half-hourly or so. I use that mostly to find imbalances for bad traders. I'm sure there are other order books available, sadly I do not have access to them myself.

Ill-b-back Jul 11, 2019 3:19am | Post# 108

Just the positions listed in the "trades" section of this site. It's what I have observed and loosely tracked over the years and has been quite a reliable contraindicator.

osittu Jul 11, 2019 3:59am | Post# 109


www.fxssi.com is a great tool that has all these combined at a glance. You can check the usage page to guide you on how best to use it.

Cheers

thj79 Jul 11, 2019 4:27am | Post# 110

Thx!

Maybe a bit off topic, but also "the herd": You read all these articles that 99% lose money on forex? If you watch the broker ads, it is more like 75% who lose money. That means around every fourth FF visitor is making some money.

Quite encouraging

Ill-b-back Jul 11, 2019 5:14am | Post# 111

{quote} i understand mate
1.26-2650 area.

Lekkim Jul 11, 2019 7:07am | Post# 112

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Heavy GBP/USD retail volume sell last week:
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Ill-b-back Jul 11, 2019 7:50am | Post# 113

Heavy GBP/USD retail volume sell last week: {image} {image}
Source?
Not from Forex Factory.

Ill-b-back Jul 11, 2019 5:15pm | Post# 114

66% Bullish...

neilsdigest Jul 11, 2019 9:57pm | Post# 115

1 Attachment(s)
I will update the chart with all current SSI and price data when I get a chance. The SSI/Price cross.

GBP/USD May 14th SELL - Price crossed the SSI (Long-Short Ratio taken from forex factory and price taken from closing prices using FXCM on tradingview)

Keep the sell order until it crosses back over. The SSI crosses the price. After I have time to update the chart I will see if the SSI crossed the price on the pullbacks.

Sell order May 14th - Price = 1.29030

I will finish the chart off when I get time but they are still buying now and not sold the GBP/USD since May 6th

Price today U.K time 02.20 12 July 2019 = 1.25372
Difference = 0.03658 = 3658 points.
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wiserltz Jul 11, 2019 10:28pm | Post# 116

I will update the chart with all current SSI and price data when I get a chance. The SSI/Price cross. GBP/USD May 14th SELL - Price crossed the SSI (Long-Short Ratio taken from forex factory and price taken from closing prices using FXCM on tradingview) Keep the sell order until it crosses back over. The SSI crosses the price. After I have time to update the chart I will see if the SSI crossed the price on the pullbacks. Sell order May 14th - Price = 1.29030 I will finish the chart off when I get time but they are still buying now and not sold the...
The way you normalize the price into SSI 's 10~80 affect greatly to the result. Do you simply mapped daily chart turning point price to SSI 50% center?

wiserltz Jul 11, 2019 11:19pm | Post# 117

{quote} The way you normalize the price into SSI 's 10~80 affect greatly to the result. Do you simply mapped daily chart turning point price to SSI 50% center?
data quality is a big problem.
ff gbpusd's long & short positions is less than 0.5K, last night i saw one person bet 50lots in a single trade, mote than 10%, Cigarguy uses 20lots in his scalping trade.

neilsdigest Jul 11, 2019 11:36pm | Post# 118

{quote} The way you normalize the price into SSI 's 10~80 affect greatly to the result. Do you simply mapped daily chart turning point price to SSI 50% center?
Re: data quality is a big problem - I always use myfxbook as I think the data quality is a lot better with more traders/positions etc.

I have a unique way of turning price into a rating like the SSI . I can't explain it at the minute as its 4am and my brain has gone sleep.

Last four days of USD/CAD - Latest SSI and price (Latest at bottom) Daily closing prices.

USD/CAD Price
61
61
60
60

SSI (Forex Factory)
61
64
65
64

Price under the SSI so SELL (Bolded)

USD/CAD sell order at 1.30808
Price now at posting 1.30387

I always use myfxbook but as I'll-be-back was researching the forex factory one so I tested it and they are the results.. OK only a small sample and by using the forex factory one its still a big theory but seems OK. I prefer myfxbook as it has more data from more brokers.

See what i'll-be-back thinks and I will do more from forex factory but its a long boring job -)

I have always used another method with the SSI but just started tying this approach.

I will carry on and finish the GBP/USD chart with data from forex factory over the weekend with all the data so it show the Price/SSI chart better.

Ill-b-back Jul 12, 2019 1:12am | Post# 119

{quote} Re: data quality is a big problem - I always use myfxbook as I think the data quality is a lot better with more traders/positions etc. I have a unique way of turning price into a rating like the SSI . I can't explain it at the minute as its 4am and my brain has gone sleep. Last four days of USD/CAD - Latest SSI and price (Latest at bottom) Daily closing prices. USD/CAD Price 61 61 60 60 SSI (Forex Factory) 61 64 65 64 Price under the SSI so SELL (Bolded) USD/CAD sell order at 1.30808 Price now at posting 1.30387 I always use myfxbook but...
I'm not concerned what data others analyse, feel free to continue Neil. I will just post from FF as that was the source of my past analysis and interest
Thanks for your contribution.

Ill-b-back Jul 12, 2019 5:29pm | Post# 120

GBPUSD bulls at 64%.
Still bearish....


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