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Real or Algo

Quoting RickM
{quote} That would require 50 major bank economists actually agreeing to do the same thing at the same time in the same direction with the same money and then close at the same time and probably talk about it in the same Pub. Any one been on a committee ?
Very fair points. It is funny though how price seems to hit a number which becomes s or r isn't it. Supply and demand is again very similar does everyone think the same. Something strange in the neighbourhood.
Quoting RickM
{quote} That would require 50 major bank economists actually agreeing to do the same thing at the same time in the same direction with the same money and then close at the same time and probably talk about it in the same Pub. Any one been on a committee ?
Agreed.
The same as two shop keepers agreeing to sell bread at the same price...one will always undercut...human nature, let alone all the banks trying to agree... that’s why I think it’s an Algo.
Quoting Spikehunter
{quote} Very fair points. It is funny though how price seems to hit a number which becomes s or r isn't it. Supply and demand is again very similar does everyone think the same. Something strange in the neighbourhood.
Psychology... the Algo sets an attractive ‘safe price’ drawing in stops/orders, visually it’s a safe haven........and yet in that safe haven they can clear stops, draw in new orders, reverse price clearing out the fresh stops set a new price for a safe haven...and all this between pouring a coffee and drinking it.
Quoting RickM
{quote} Hi bfx17 Will price go through? Here is how I see it, maybe it depends on the weight of orders down there - Do they weight enough yet to attract the Algo to run down and remove this inbalance from the charts?. I see the market as a Fabric that has three dimensions - Density, Weight and Space. Eventually the weight of the stops below becomes so heavy and dense, it will create space (Gaps) to ensure price will close this inbalance from the market. I would say at every touch of the reversal zone, orders would double in size and weight. Then...
Hi Rick,

I am sure the price will break that level...it looks very much like a trap and I think the real target is below 132. Of course, the big question is WHEN...and for this I don't have a clear answer...

I spent a lot of time thinking how to trade toward the targets and until now I didn't find a consistent solution, because I cannot know when the number of orders in the target zone is enough for the SM/Algo to make the move. I also analyzed your Vacuum theory , but still no clear option until now. That's why I don't bother much anymore trying to anticipate when the level will be broken...

It is more predictable to trade after the target was hit and a retracement is highly probable...

Btw, awesome explanation using the analogy of space time fabric and gravity

Cheers,
B.
On ignore list of scammers, deceivers and low IQ individuals. Exclusively
Quoting bfx17
{quote} Hi Rick, I am sure the price will break that level...it looks very much like a trap and I think the real target is below 132. Of course, the big question is WHEN...and for this I don't have a clear answer... I spent a lot of time thinking how to trade toward the targets and until now I didn't find a consistent solution, because I cannot know when the number of orders in the target zone is enough for the SM/Algo to make the move. I also analyzed your Vacuum theory , but still no clear option until now. That's why I don't bother much...
Waiting for a target to be cleaned out after a sizeable move/expansion with timing into the TMA might be worth investigating!!
Quoting moodybot
{quote} Psychology... the Algo sets an attractive ‘safe price’ drawing in stops/orders, visually it’s a safe haven........and yet in that safe haven they can clear stops, draw in new orders, reverse price clearing out the fresh stops set a new price for a safe haven...and all this between pouring a coffee and drinking it.
You agree with RickM's post, yet you are essentially saying the same thing, except that it's in the form of an "algo" setting an "attractive safe price". Not meaning to sound aggressive but it sounds a little hypocritical?
Who created this "algo"?
Does every institution have to agree on this price the "algo" sets?
Is it random?
It's clearing out stops/orders..... for who?

50 major bank economists agreeing to a fair price or an algorithm doing essentially the same thing - for someone else or a group of people or instos. You're talking about the same thing here and all just opinion.

Support or Resistance, Supply or Demand, Buy Zones and Sell Zones, Stop Hunting Areas, it doesn't matter what you want to call it.. because once you realise that 90% of the charts that have been posted here will have the same highlighted "zones" that the next bloke is posting who calls them "Ultra Resistance Extreme of the Day Area". Once you come to that realisation you'll know that it doesn't matter what you want to call it, price is predictable and it doesn't matter if it's algo's or institutions behind it.

Most of my trades have less than 5 pips draw down as I'm pinpoint accurate on my trades using volume profile, extremes and consolidation areas, as I've found price is predictable around these areas day in and day out. Yet I call it none of the above.

But at the end of the day, if it helps with your own psychology to give it a backstory and a reason why price moves and to give it new names like Herd Mentality zones, and it improves your trading... then it's no ones place to tell you otherwise, because it's more than likely there was someone else who just took that same pinpoint precision trade as you, except that it was at his "Support or Resistance" area.

The above is my opinion only.
Quoting RickM
{quote} That would require 50 major bank economists actually agreeing to do the same thing at the same time in the same direction with the same money and then close at the same time and probably talk about it in the same Pub. Any one been on a committee ?
Economists all agreeing on One Thing is possible, there is a name for it - Leap Year. They do this every Feb 29th.
Quoting moodybot
{quote} Agreed. The same as two shop keepers agreeing to sell bread at the same price...one will always undercut...human nature, let alone all the banks trying to agree... that’s why I think it’s an Algo.
Great discussions going on here

But of course your reply misses the obvious too. There isn't one algo... because of same reason why you reject 50 banks can't agree on price. Two sides of same coin really.

Think it was on George's thread he stated that there was one entity(algo) that controls everything, which I respectively disagree with and nothing has persuaded me in my research to change that view. In the end I consider these key levels and trade how they react to them when they are hit.
*** Shoot for the moon. Even if you miss, you'll land among the stars. ***
Quoting bfx17
{quote} Hi Rick, I am sure the price will break that level...it looks very much like a trap and I think the real target is below 132. Of course, the big question is WHEN...and for this I don't have a clear answer... I spent a lot of time thinking how to trade toward the targets and until now I didn't find a consistent solution, because I cannot know when the number of orders in the target zone is enough for the SM/Algo to make the move. I also analyzed your Vacuum theory , but still no clear option until now. That's why I don't bother much...
bfx17

Lets not bring my Vacuum theory into this thread or we will both get headaches. Actually I was telling Andy about my two sorts of targets I trade off but I didn't mention Vacuums.
My final word here would be I found you can trade the vacuums very well by adding them to Georges Target theory.
IT ADDS TO THE ALGO STORY -
Just 1 chart to finish - There were NO targets here visible to us, but the Algo knew where the vacuum was ( this was just above the trap door on Andy's EJ Chart ).

Cheers
Attached Image (click to enlarge)
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Trading thin liquidity at the boundary of the charts
Forgive my ignorance, who is George.
Quoting pierre23
{quote} You agree with RickM's post, yet you are essentially saying the same thing, except that it's in the form of an "algo" setting an "attractive safe price". Not meaning to sound aggressive but it sounds a little hypocritical? Who created this "algo"? Does every institution have to agree on this price the "algo" sets? Is it random? It's clearing out stops/orders..... for who? 50 major bank economists agreeing to a fair price or an algorithm doing essentially the same thing - for someone else or a group of people or instos. You're talking about...
Hi Pierre

I think this thread is just a general discussion on whether Supply & Demand rules the game or is there an Algo actually controlling and moving the price.
Just a general discussion here and Andy isn't selling signals.
Can I say most of my trades also have less than 5 pips draw down but I do believe in control of a Algo - just not how you have described it.
Its a mindset game.

Cheers
Trading thin liquidity at the boundary of the charts
Quoting Spikehunter
Forgive my ignorance, who is George.
Sorry Spikehunter

George Aus from the thread "Price action at the core / TMA intra day"
I haven't meet a trader in 15 years that comes close to his skills.
Trading thin liquidity at the boundary of the charts
Quoting RickM
{quote} Hi Pierre I think this thread is just a general discussion on whether Supply & Demand rules the game or is there an Algo actually controlling and moving the price. Just a general discussion here and Andy isn't selling signals. Can I say most of my trades also have less than 5 pips draw down but I do believe in control of a Algo - just not how you have described it. Its a mindset game. Cheers
Sure, fair enough and I know he's not selling anything.

Like I said in my post, whatever thought process makes you a better trader. If there is a puppet master, and that way of thinking about it helps you see how the market moves and makes you a better trader then I would be the last person to say otherwise if it works for you.
Quoting RickM
{quote} Hi Pierre I think this thread is just a general discussion on whether Supply & Demand rules the game or is there an Algo actually controlling and moving the price. Just a general discussion here and Andy isn't selling signals. Can I say most of my trades also have less than 5 pips drawdown but I do believe in control of a Algo - just not how you have described it. Its a mindset game. Cheers
I think what it comes down to is not algos. Algos are not a big part of the market on one hand, and their role is not to create traps for retail to fall for. You have to remember that retail traders, especially the ones that fall for such 'stop hunts', are not a big amount of liquidity to draw their attention. Algos do not take orders at their discretion, they take the orders from the client or institution, and their job is to absorb the volume and chop big orders down to execute as efficiently as possible.

The reason why you see multiple bottoms or tops that eventually get taken out and reverse is that they were a retail construction, to begin with. Just from looking at a chart for laymen, you do not know whether a support or resistance area is strong or weak. Multiple tests of it do not suggest algo conditioning, rather market players with not enough liquidity to move the market on a higher time frame, until price eventually finds the real big liquidity taking out the stops of retails, that price gets filled at lower 'wholesale' prices, that's when a shift in big trends take place.

This is nothing more than supply and demand.

Attached Image (click to enlarge)
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You had a 2019 major low, then a buy attempt in March 2020 from retail, while wholesale prices were much lower, it was at that point that the same low kept being bought until the selling pressure was too big for small money to keep up. Price had to move to wholesale level, that's when you get in.

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This is also explained in many different lingo, stop runs, fake breakout, bear trap, stop hunting, it doesn't matter. What matters is the price wasn't going to hold, it needed bigger money if the chart were to reverse, and it wasn't found at the retail prices, but a bigger discount.

And yes, I bought the dip.
Quoting RickM
{quote} bfx17 Lets not bring my Vacuum theory into this thread or we will both get headaches. Actually I was telling Andy about my two sorts of targets I trade off but I didn't mention Vacuums. My final word here would be I found you can trade the vacuums very well by adding them to Georges Target theory. IT ADDS TO THE ALGO STORY - Just 1 chart to finish - There were NO targets here visible to us, but the Algo knew where the vacuum was ( this was just above the trap door on Andy's EJ Chart ). Cheers {image}
I brought it in here as it Algo related...and because it is very interesting

If I understood correctly from your previous posts, the vacuum is perceived by the Algo as being a gap/hidden gap, while it is not. That's why the Algo tries to fill it on and on without success. The chart you posted highlights exactly that: the target was broken and then the price returned 2 times at that level trying to fill that imaginary gap.

I thought that this vacuum is/was generated by a sort of a glitch which creates this confusion in the Algo's perception, but not so sure anymore...

Anyways, subject closed.

Cheers,

B.
On ignore list of scammers, deceivers and low IQ individuals. Exclusively
Quoting pierre23
{quote} You agree with RickM's post, yet you are essentially saying the same thing, except that it's in the form of an "algo" setting an "attractive safe price". Not meaning to sound aggressive but it sounds a little hypocritical? Who created this "algo"? Does every institution have to agree on this price the "algo" sets? Is it random? It's clearing out stops/orders..... for who? 50 major bank economists agreeing to a fair price or an algorithm doing essentially the same thing - for someone else or a group of people or instos. You're talking about...

Excellent opinion and please keep posting when able.
My opinion is based on information given to me years ago, and somewhere around 2012 I decided the info may be correct and on this forum I mentioned that I believed we were only dealing with an Algo.
My opinion hasn't changed.
I agree with both George and Rick how the market structure functions, however I take the view that each 'point of interest' is created to draw in money, not created by money itself and that may not necessarily be either Georges or Ricks view, in fact I know it isn't.
I agree with you it doesn't matter what we call the zones, whether it's herd mentality or supply and demand but if I were to call it supply and demand which would be based on money moving the market, then you can say I was being hypocritical, I don't believe that, so Herd Mentality created by an Algo becomes my interpretation.
As to who created the Algo, ...........
Quoting bfx17
{quote} I brought it in here as it Algo related...and because it is very interesting If I understood correctly from your previous posts, the vacuum is perceived by the Algo as being a gap/hidden gap, while it is not. That's why the Algo tries to fill it on and on without success. The chart you posted highlights exactly that: the target was broken and then the price returned 2 times at that level trying to fill that imaginary gap. I thought that this vacuum is/was generated by a sort of a glitch which creates this confusion in the Algo's...
Hi bfx17

It actually hit the vacuum 32 times -
Yes it is confused
Message you
Trading thin liquidity at the boundary of the charts
  • Post #118
  • Quote
  • Edited Apr 26, 2020 12:13am Apr 25, 2020 9:45pm | Edited Apr 26, 2020 12:13am
One last comment.

Single algo purposed to create price or demand and supply, which is which that determine price? How important is it that we know this?
Before even this, does demand and supply determine price or price determines demand and supply?

Demand and supply is too broad a definition and too superficial for our purpose of future price determination in our forex trading activity. We need more knowledge about the nature, characteristic and behaviour of demand and supply to be able to attempt to do that. The point is it has to go deeper than economics 101.

Future price determination involves pricing and value modelling.

Watch this series of microeconomics lectures to gather knowledge about supply and demand. When you are up to speed then look up the math aspect. Be prepared for a long education journey.

Inserted Video


Edit - The goal of every trader in all trading markets, novice veteran expert pro, is about future price determination. Whether it's done in a structured manner(Riemann hypothesis) or with crude methods, consciously or subconsciously.
Trade the value
As I said before, I am not a very informed person about this subject, but I am reading the thread with a lot of interest.

I have always been amazed on how perfect some trendy structures develop sometimes.

Is this algo? or has nothing to do with the thread?

Attached Image (click to enlarge)
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Keep it simple All Time Return: na
Quoting xRedStaRx
{quote} I think what it comes down to is not algos. Algos are not a big part of the market on one hand, and their role is not to create traps for retail to fall for. You have to remember that retail traders, especially the ones that fall for such 'stop hunts', are not a big amount of liquidity to draw their attention. Algos do not take orders at their discretion, they take the orders from the client or institution, and their job is to absorb the volume and chop big orders down to execute as efficiently as possible. The reason why you see multiple...
Hi there,

Algos has been dominated FX transaction since it introduce digital/electronic to the system. I found very interesting thread for beginner like me:

Full detail of technical analysis
https://www.forexfactory.com/showthread.php?t=727775
Please prepare a brain explosion as I have as newbie in FX industry

Most applicable, sensible and understandable for newbie like me
https://www.forexfactory.com/showthread.php?t=874421
https://www.forexfactory.com/showthread.php?t=768090

Then think about it once again

My high appreciation to those members who give their experience, skills and knowledge and precious time to help us improve our trading.

Just my 2 cents
Cheers!
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