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Trading Institutional Order Flow

  • #8,901
  • Sep 28, 2020 2:55am Sep 28, 2020 2:55am
Quoting youngzen
Hi everyone, This is from post 236, may I ask is the red arrow an entry or not? Do we think the trend line broken or not before the red arrow? Thanks a lot. {image}
Hello youngzen
Good to meet you

You are absolutely correct in what you are alluding to, in that the momentum line was not broken before price returned to the SZ.
However, that is not what was being suggested in the post. When you read it, what was being inferred was that despite that SZ not quite meeting the rules, the shorts in the market had started using it as an area from which to take short positions.
Now that this had become clear, the plan was to then start looking for shorts, as the comment on the charts state.

hope that clears it up for you

Best wishes
Be careful what you think because your thoughts run your life..Solomon
  • #8,902
  • Sep 28, 2020 3:15am Sep 28, 2020 3:15am
Quoting allaka
Dear AKt and members on the forum, been a reader here for a while, thank you and everyone for the informative posts, just now getting the confidence to post my analysis for questions and observations. My time frames are Monthly Weekly and Daily. Here is a summary of the notes and questions and charts with corresponding time frames for review. -When they say don't diddle in the middle do they mean the HTF in sequence or the entry time frame? -During my backtesting i observe that while waiting for confirmation on the entry or middle time frame, price...
Hello allaka
Good to meet you and well done for summoning the courage to post.

Many questions in one post.
Lets see if it can be cleared up a bit for you

1. Don't diddle in the middle - first one must define what the middle is. It is that price range between higher timeframe supply and higher timeframe demand. It is probably the most challenging to take trades in without adequate skill, study and practice.

2. Traders will have different backtesting results so i am not able to comment on this aspect of your question. I am however able to comment on confirmation entries by saying that if any trend is to change it must first of all slow down and them turn. Just like a car looking to take a left turn on a motorway must first slow down, change gears and then make the turn, otherwise it risks an accident. So if one works with that premise it is not hard to see that prices on reaching a higher timeframe level will often first slow down, evidenced for supply and demand traders by the end of momentum, removal of opposing zones and creating of new zones in line with the new direction the trend is likely to take. Once these events occur the trader then starts preparing to engage the new trend. Now, this is one of the areas in trading and speculating that the mental game is even more important for traders, that waiting. Seeing what is happening with price, understanding it and wanting desperately to engage and get on board, but the market just does not quite set up as the trader would like....frustrating as it may be, firstly it does not happen as often as most of us think relative to other times when the market does give opportunities. This is why i always tell my traders and mention in my posts here that one is "looking for" trading opportunities. One may know what the market is doing or is about to do without being able to take advantage of it when one would like. So patience is the answer to this question. If the trade doesn't set up the trader always has the option to move on rather than force it.
With a monthly-weekly-daily sequence, waiting on the weekly will take weeks but is the more reliable signal. Waiting on the daily is the earlier but less reliable option.

3. Assessing the quality of a zone is a critical part of the decision making process for supply and demand traders. Regardless of how may zones one is presented with, they are unlikely to be of the same quality for example in terms of their formation, location, position in the context of trend, time spent at the level, how fresh the level is, removal of an opposing zone etc. This is something that is important to learn and DO on every zone the trader is considering betting at.

4. Price removing an opposing zone as a rule does not take into account the freshness or otherwise of the zone that is removed. Whether the zone was tested or not is not as relevant as the fact that it was removed regardless of the formation of the level, whether or not it is a L.O.T.O.L zone etc.

best wishes
Be careful what you think because your thoughts run your life..Solomon
  • #8,903
  • Sep 29, 2020 4:08pm Sep 29, 2020 4:08pm
Quoting Akt
{quote} Hello youngzen Good to meet you You are absolutely correct in what you are alluding to, in that the momentum line was not broken before price returned to the SZ. However, that is not what was being suggested in the post. When you read it, what was being inferred was that despite that SZ not quite meeting the rules, the shorts in the market had started using it as an area from which to take short positions. Now that this had become clear, the plan was to then start looking for shorts, as the comment on the charts state. hope that clears it...
Hi Akt, Nice to meet you, and thanks a lot.
  • #8,904
  • Edited 3:46pm Sep 30, 2020 3:21pm | Edited 3:46pm
Quoting Akt
{quote} Hello allaka Good to meet you and well done for summoning the courage to post. Many questions in one post. Lets see if it can be cleared up a bit for you 1. Don't diddle in the middle - first one must define what the middle is. It is that price range between higher timeframe supply and higher timeframe demand. It is probably the most challenging to take trades in without adequate skill, study and practice. 2. Traders will have different backtesting results so i am not able to comment on this aspect of your question. I am however able...
Hi Akt,
Thanks for your patience to explain all the details.
May I ask you a little more about confirmation entries?
After a fresh zone formed which removed opposing zones and broke TL, we set limit orders to wait price return.
Any case we should cancel our orders?
I noticed sometimes these trades are easy to lose.
1/ Price went too far before it returns.
2/ Price takes a long time to return.
3/ Price comes back with huge momentum.
What do you suggest to manage these orders?
Thanks in advance.
  • #8,905
  • Sep 30, 2020 10:27pm Sep 30, 2020 10:27pm
Quoting youngzen
{quote} Hi Akt, Thanks for your patience to explain all the details. May I ask you a little more about confirmation entries? After a fresh zone formed which removed opposing zones and broke TL, we set limit orders to wait price return. Any case we should cancel our orders? I noticed sometimes these trades are easy to lose. 1/ Price went too far before it returns. 2/ Price takes a long time to return. 3/ Price comes back with huge momentum. What do you suggest to manage these orders? Thanks in advance.
Hey Youngzen,

Those are some good observations when deciding whether to cancel a trade. Here are some observations i've had while testing out this strategy that might help you shape your rules for your trading.

1) If price reaches an opposing zone of a Higher Time Frame before returning to my zone I will wait for "Re-confirmation" before I attempt to take a trade.
2) If price is returning on your entry timeframe and forms an opposing zone @ < 2:1 (or whatever you deem as an acceptable R:R)
3) If price is returning in a "Stair stepping" (Base, rally, base, rally without any, or very small pull backs) manner on your entry timeframe This is a sign of strong momentum and any zone that stands in the way tend to get ran over. They DO however tend to turn into trade-able zones to take in the direction of the current price action.

Hope this helps
  • #8,906
  • Oct 1, 2020 4:43pm Oct 1, 2020 4:43pm
Quoting Masterquis
{quote} Hey Youngzen, Those are some good observations when deciding whether to cancel a trade. Here are some observations i've had while testing out this strategy that might help you shape your rules for your trading. 1) If price reaches an opposing zone of a Higher Time Frame before returning to my zone I will wait for "Re-confirmation" before I attempt to take a trade. 2) If price is returning on your entry timeframe and forms an opposing zone @ < 2:1 (or whatever you deem as an acceptable R:R) 3) If price is returning in a "Stair stepping" (Base,...
That's really helpful, Masterquis.
Thanks for sharing.
  • #8,907
  • Oct 2, 2020 8:56am Oct 2, 2020 8:56am
Hello everyone,

Nice to meet you!

I have just found this thread and I am more than glad to become a part of it. Beautiful stuff and there is a lot knowledge. I'm following SAD methodology from the beginning, starting from the first pages of the thread plus Storehouse Analytics videos.

Thank you and greetings from Argentina.
  • #8,908
  • Oct 2, 2020 11:24am Oct 2, 2020 11:24am
Good day Akt and fellow traders.

If in line with the trend. Price get to a fresh flip zone, can we set and forget or do we wait wow confirmation
  • #8,909
  • Oct 2, 2020 10:13pm Oct 2, 2020 10:13pm
Quoting Obiech
Good day Akt and fellow traders. If in line with the trend. Price get to a fresh flip zone, can we set and forget or do we wait wow confirmation
I haven't backtested on flip zones very much, but our rules tell us if a zone is in line with the Higher Timeframe and Intermediate Timeframe Trend then we can take a trade-able Lower Timeframe zone as a set and forget.

Like I said, I haven't specifically backtested flip zones to see how viable this approach is so you might want to backtest this scenario on your own to see how well it does.
  • #8,910
  • Oct 3, 2020 12:19am Oct 3, 2020 12:19am
Quoting haluk
Hello Mike, All , Just started looking to charts after some time, and of course after watching the great "Supply and Demand market report" video from youtube. GBPNZD Daily chart , we broke the momentum and buyers appeared strongly. The price is at relatively low levels when monthly curve is considered. On the 4 hr chart , we can see the range below that caused the rally . Monthly and weekly charts are in equilibrium. Joining this buying can be from a daily demand or after creation of new H4 demand zone . Meanwhile , as a good profit margin is visible...

Hello Traders ,

For GBPNZD , I was basically looking to join buyers from daily levels and/or waiting for creation of h4 demands. Same time , selling from h4 suplies above with confirmation, due to visible good profit margin . I had a chance to short it two times. Missed the first one and it was a bit difficult. But the second one worked well .

Now we have h4 and daily demand levels below to join buyers for the coming days ,

Happy trades All,
H.
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  • #8,911
  • Oct 3, 2020 10:27am Oct 3, 2020 10:27am
The Confirmation Entry is starting to all come together for me took several successful trades the past week and really grateful to all that helped explain as well as AKT

This was My Friday trade on GBPJPY

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Price entered a 1HR Supply Zone so went down to the 5M timeframe for entry signal

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This was a nice 1:3RR for me
I Learn so i can Earn
  • #8,912
  • Oct 3, 2020 10:42am Oct 3, 2020 10:42am
Quoting phinny
The Confirmation Entry is starting to all come together for me took several successful trades the past week and really grateful to all that helped explain as well as AKT This was My Friday trade on GBPJPY {image}Price entered a 1HR Supply Zone so went down to the 5M timeframe for entry signal {image} {image} This was a nice 1:3RR for me

Nice Job man. Now its just lather, rinse, repeat.

I don't know if you're doing this already or not, but I would recommend taking screenshots like this for every trade you take, win or lose, annotating them, and putting them in some type of journal where you can review on a monthly or quarterly basis.

I solemnly swear journaling has been the biggest reason for me being able to figure out my bad habits, and the holes in my psychology to become consistent in my approach to trading.

Don't wait until you're 2 years into this business, like me, until you start treating it like one.

Gas on the pedal!
  • #8,913
  • Oct 3, 2020 11:10am Oct 3, 2020 11:10am
Quoting Masterquis
{quote} Nice Job man. Now its just lather, rinse, repeat. I don't know if you're doing this already or not, but I would recommend taking screenshots like this for every trade you take, win or lose, annotating them, and putting them in some type of journal where you can review on a monthly or quarterly basis. I solemnly swear journaling has been the biggest reason for me being able to figure out my bad habits, and the holes in my psychology to become consistent in my approach to trading. Don't wait until you're 2 years into this business, like me,...


Thanks so much for the advice
I will definitely start journaling every trade from now on
I really appreciate all your help
I Learn so i can Earn
  • #8,914
  • Oct 4, 2020 8:00am Oct 4, 2020 8:00am
Quoting youngzen
{quote} Hi Akt, Thanks for your patience to explain all the details. May I ask you a little more about confirmation entries? After a fresh zone formed which removed opposing zones and broke TL, we set limit orders to wait price return. Any case we should cancel our orders? I noticed sometimes these trades are easy to lose. 1/ Price went too far before it returns. 2/ Price takes a long time to return. 3/ Price comes back with huge momentum. What do you suggest to manage these orders? Thanks in advance.
Hello youngzen

Thank you for the questions.
There is really one answer that applies to them all - constant re-valuation of the trend.

If the time it takes for prices to return or the price action that has occured prior to the return have resulted in a change in the big picture trend, the trader must be aware of this and take evasive action.

It is worth saying that just because one has a zone, does not mean that prices will a) return to it or b) return to it within a time that the situation on the chart remains the same as when the zone was created. Constat re-evaluation is required given that price is always moving and conditions always changing on the chart.

best wishes
Be careful what you think because your thoughts run your life..Solomon
  • #8,915
  • Oct 5, 2020 4:53am Oct 5, 2020 4:53am
Hi everyone got to know about this thread through the youtube channel good to be here with Order Flow traders not many trades this concept, will be sharing my charts to see if anyone is aligned with what am looking @ positive criticism are welcome
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  • #8,916
  • Oct 5, 2020 7:07am Oct 5, 2020 7:07am
Quoting Akt
{quote} Hello youngzen Thank you for the questions. There is really one answer that applies to them all - constant re-valuation of the trend. If the time it takes for prices to return or the price action that has occured prior to the return have resulted in a change in the big picture trend, the trader must be aware of this and take evasive action. It is worth saying that just because one has a zone, does not mean that prices will a) return to it or b) return to it within a time that the situation on the chart remains the same as when the zone was...
Hi Akt, thanks a lot for your golden advice!
  • #8,917
  • Oct 5, 2020 10:43pm Oct 5, 2020 10:43pm
Quoting Beelyjay
Hi everyone got to know about this thread through the youtube channel good to be here with Order Flow traders not many trades this concept, will be sharing my charts to see if anyone is aligned with what am looking @ positive criticism are welcome {image}
Greetings from Jamaica...im new here
My Markup is the same and i was wondering if it was best to use the set and forget entry method or confirmation
I don't really understand when or why you should use them differently..so is this a case? if so please explain why
  • #8,918
  • Oct 5, 2020 10:57pm Oct 5, 2020 10:57pm
Quoting pablobruquez
{quote} Greetings from Jamaica...im new here My Markup is the same and i was wondering if it was best to use the set and forget entry method or confirmation I don't really understand when or why you should use them differently..so is this a case? if so please explain why
Hey Pablo,

Unfortunately, without seeing a top down analysis we can't assess the quality of Beejay's trade enough to tell if this should be taken as a S&F or Confirmation. If you want to find out how and when to use these type of entries, check out the sister YouTube channel to this thread. The YouTube Channel is called Storehouse Analytics.

Once you're on on the YouTube channel search "Confirmation Entries" That video will give you the answers you're looking for.
  • #8,919
  • Oct 6, 2020 12:03am Oct 6, 2020 12:03am
respect, I found it and now I understand thank you for your help zeen
  • #8,920
  • Oct 6, 2020 2:00pm Oct 6, 2020 2:00pm
Hi Traders,

I'd like to share an MT4 supply and demand indicator I'm developing. If you like it (or not) please let me know. It is multi-timeframe and can be used multiple times on same chart.

The inputs are as shown in the screenshot below. They should be self-explanatory except for:

-- The fractal pattern (Left Strength and Right Strength) is used to form the spply/demand block. Default is 2 (candles before and after) but can be adjusted.
-- Maximum levels to Use - It uses six fractals back by default to look for supply and demand areas. This can be adjusted to use less than 6, but 6 is max.

Operation:
-- It is based on fractals, however Supply will use only higher fractals than price. Demand will be lower fractals than price.
-- Supply/demand areas will not be drawn if they are inside another S/D area. (see lower areas 2-3 on screenshot below, notice 2 is a fractal but it is inside #3
-- S/D areas will be cleared(invalidated) when CLOSE of a candle gets above or below the high/low.

I will add some examples below....



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Attached File(s)
File Type: ex4 Supply_and_Demand_V1.ex4   92 KB | 348 downloads
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