Disliked{quote} I have been chewing what you said. Does this mean when they make that move they are dribbling traders and sending them to the wrong side? Or they just matching the order that is in front of them (as according to Buffett's quote below)? What else is possibly there in that move? I watched the Market Delta "Footprint Deep Dive" Course videos some time ago and I tried to marry the stop runs concept with the order flow and I felt something was off. "Which, you know, has always struck me as like having a house that you like, and you’re living...Ignored
I think there is a basic flaw traders fall into which newbies don't. You know that saying "beginners luck " when you often get a nice win at the start of your trading career and you go "Wow, this is easy".
They look at the market with almost no knowledge and see the price move so jump and get a nice win.
Soon after they start to place 100 indicators on their charts and look for areas they believe supply and demand are placed and just start trading for those moves.
They lose again and again.
Why did the beginner get lucky?
Because they saw the market as it really is - then just over complicated trading after a short period with incorrect assumptions.
A... Passive Limit orders are stronger than Market orders = Stop runs occur because liquidity pools in clusters
B... Aggressive market orders are weaker than passive limit orders = The big players want to hunt my stop loss at any chance because they need the liquidity.
The Newbie does not see that but instead see's this
A... The market just moved strongly bearish so people must be selling = I have no idea why or where but I will Sell because it seems aggressive
B.. I don't know what supply and demand is?
What does this tell us
Aggressive Market orders are stronger than passive limit orders - it pays no attention to stop loss cluster because they contain little liquidity.
There is very little liquidity on a chart - the primary amount of liquidity in a trend comes from new market orders expanding the pool of current liquidity.
Only Michael and DonPato like me talk about Passive Limit orders and Aggressive market orders but last time I looked, they see it the other way around.
Just another viewpoint perhaps.
Trading thin liquidity at the boundary of the charts
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