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The brutal truth of day trading

  • #781
  • Edited 11:51am May 12, 2021 8:19am | Edited 11:51am
Quoting GEfx
{quote} And when will the big guys square up Friday's move (which they will do)?
If anyone has been trading today, you witnessed the square up that I mentioned above. The E$ and $CHF squared up to within about 5 pips, the $j exactly to the pip, and the N$ and A$ both exceeding a precise square up. The G$ and $CAD will likely take much longer to square. Excellent trading after the square up. I don't think squaring up is necessary a brutal truth, but it's definitely tradeable. Hope everyone got in on this move.

Edit: and now the E$ and the $CHF have completely squared, with a little extra for good measure.
  • #782
  • May 12, 2021 4:21pm May 12, 2021 4:21pm
Quoting GEfx
{quote} If anyone has been trading today, you witnessed the square up that I mentioned above. The E$ and $CHF squared up to within about 5 pips, the $j exactly to the pip, and the N$ and A$ both exceeding a precise square up. The G$ and $CAD will likely take much longer to square. Excellent trading after the square up. I don't think squaring up is necessary a brutal truth, but it's definitely tradeable. Hope everyone got in on this move. Edit: and now the E$ and the $CHF have completely squared, with a little extra for good measure.
Square? I thought everyone draw lines. Lines is the key? No? Where is Peter? We need to tell him there are squares, rectangles, triangles and even circles to study. Hurry up! The holy grail is very close!
Observer effect
  • #783
  • May 12, 2021 5:47pm May 12, 2021 5:47pm
Quoting ryuryu
{quote} Square? I thought everyone draw lines. Lines is the key? No? Where is Peter? We need to tell him there are squares, rectangles, triangles and even circles to study. Hurry up! The holy grail is very close!
I think I've seen you on fti's thread, so you're familiar with the market squaring up. But under the circumstances it's probably best if I skip adding to this discussion any observations about poles, flags, and boxes, given that lines throw some of you into a tizzy. I'll pass on holy grail talk. Good trading!
  • #784
  • May 12, 2021 6:25pm May 12, 2021 6:25pm
Quoting GEfx
{quote} I think I've seen you on fti's thread, so you're familiar with the market squaring up. But under the circumstances it's probably best if I skip adding to this discussion any observations about poles, flags, and boxes, given that lines throw some of you into a tizzy. I'll pass on holy grail talk. Good trading!
It was a joke we were trading live those spikes*.
* Not a single square was damaged. No single line drawn.
Observer effect
  • #785
  • May 12, 2021 6:45pm May 12, 2021 6:45pm
Quoting ryuryu
{quote} It was a joke we were trading live those spikes*. * Not a single square was damaged. No single line drawn.
I know you were joking, but there are others lurking about who are not. I need to be careful what I say! Good trading and take care!
  • #786
  • Edited 7:58pm May 12, 2021 7:31pm | Edited 7:58pm
Quoting TraderTim125
{quote} Order Flow and other interesting things Thanks Rick A couple of years ago I did some programming work for a fairly experienced trading colleague of mine. It was based around Order Flow (OF) and segmented profiling. At the time I didn’t feel he was quite on track as to where he was directing his project. To the best of my knowledge he never managed to integrate all the work we did into his day to day trading process. It was nonetheless interesting. From what I saw, this OF stuff seems to have significant potential for short term trading but...
Hi TraderTim

I totally agree with you, the order flow methods offers significant potential for the short term trader but the current educational material fails to identify the real key ingredient’s.

I believe there is three ingredients we should be studying when using the order flow tools. The training materials I see focus on the big picture and irrelevant details, instead of looking more closely at the auction process.

If momentum exists and price moves, how does the big players create expansion of price and how do they halt expansion of price.
In other the words, what elements are needed for them to create this pressure on price. All three of those elements are measurable and seen on a order flow chart.

For me, it’s a tool of establishing the amount of applied pressure that’s allowed to expand price without fracturing liquidity pools.

Cheers
Trading thin liquidity at the boundary of the charts
  • #787
  • May 13, 2021 12:33am May 13, 2021 12:33am
Quoting rockypoint
Sorry but I disagree. Yes the attributes of greed, desire for action, impatience, fear of missing a profitable trade, lack of discipline are things all types of trader might have issues with until they learn to control their emotions. To think that day trading doesn't require patience and discipline is just wrong. To be a successful trader you need: 1) Thorough understanding of your psyche, what kind of trading suits your personality best. Most people are suited to longer time frames. But some are not the waiting breeds impatience and loss of discipline,...
That's true.

Traders are not the same but, the main points you listed above are very important to succeed in trading (short to long term trading). The problem is that some traders love market noise and others can not handle market noise therefore, they switch from scalping or day trading to higher timeframes
  • #788
  • May 13, 2021 1:00am May 13, 2021 1:00am
Quoting ryuryu
{quote} Square? I thought everyone draw lines. Lines is the key? No? Where is Peter? We need to tell him there are squares, rectangles, triangles and even circles to study. Hurry up! The holy grail is very close!
Agree ryuryu to your sarcasm. All this talking without statistics have low value.

But anyway gold is mined from dirt. So some ideas could be found in any conversation.

nobody will tell his working systems...
  • #789
  • Edited 9:44pm May 13, 2021 2:05am | Edited 9:44pm
Please read this ....

https://awealthofcommonsense.com/201...probabilities/

If a human doses themself with self interest and too much greed, they lose sight of certain basics. Statistics and probabilities help but do not tell the whole story.

If day trading cannot be seen from ALL aspects and perspectives you WILL waste time and lose more of your money than necessary.

You need to understand the 4 Tiers of probabilities. Combined with time and context.

Go here and start really learning ....

https://www.forexfactory.com/thread/...ng-and-trading

Enjoy.

Peter
Real Trading is not gambling.
  • #790
  • Edited 12:19pm May 16, 2021 11:59am | Edited 12:19pm
Quoting RickM
{quote} Hi TraderTim I totally agree with you, the order flow methods offers significant potential for the short term trader but the current educational material fails to identify the real key ingredient’s. I believe there is three ingredients we should be studying when using the order flow tools. The training materials I see focus on the big picture and irrelevant details, instead of looking more closely at the auction process. If momentum exists and price moves, how does the big players create expansion of price and how do they halt expansion...
Defining the bigger picture

Hi Rick
I would like to try and participate in this ongoing conversation about order flow etc but before attempting to do so I would also like to make sure that we are both on the same page in regards to some of the terms that you use.

When you refer to "Big Players" I am assuming that you are talking about the dozen or so large commercial banks like Goldman Sachs, JPMorgan etc that account for the bulk of daily FX volume in what is generally referred to as the interbank market. My guess would be that this group would account for something like about 80% of all daily FX money flow. This in turn implies that this group of banks are the primary drivers of price movement over say a day. The dynamics of how these dozen or so nominally independent operators drive market prices would be anything but simple to determine without access to their order books and any other inside information.

By "Expansion", I am assuming that you mean when price has made a significant move out of a consolidation range. These moves are typically quite large and often represent a substantial portion of a daily range. These moves can also, but not always occur quite quickly. When the "expanded" price comes to rest it may sit at the new level for some time or it may retrace quite rapidly back towards the break out level.

By "Halting Expansion" do you mean the action that brings the expansion price movement to an end or perhaps more importantly from an order flow perspective, what holds price in a consolidation range while big player(s) build their position(s).

Fracturing liquidity pools - By "Liquidity Pools" I assume that you refer to the net sum of all maximum trading account limits across all the "big player" organisations. Individual trading teams and organisations would need to manage this to ensure they always had sufficient funds to carry out their allocated role in any manipulative manoeuvre without running out of resources. Is this what you mean by the term fracturing? I am assuming that a significant degree of collaboration takes place within an organisation and more than likely between various organisations.

Overall, this scenario suggests that most price movement and specifically the short term intra day price movement that we are interested in trading is the result of complex interactions between a small group of big players.

Regards
Tim
Don't Guess Test
  • #791
  • May 16, 2021 1:07pm May 16, 2021 1:07pm
Quoting joyny
{quote} Agree ryuryu to your sarcasm. All this talking without statistics have low value. But anyway gold is mined from dirt. So some ideas could be found in any conversation. nobody will tell his working systems...
Hi, joyny!

There are some gold around (working strategies). For example Laura's Roadmap thread. Very good, well explained, profitable, logical, from real trader. But other 99% here is a "magic" bullshit around "feelings", "brains" and unstoppable luck. For example Trading Made Simple - the greatest example of fake (if 2 candles are green 3rd will be green + 999 rules, but if the trade was great you can skip 998, if it was not good you must be follow all the 999 of them).
Observer effect
  • #792
  • May 16, 2021 7:22pm May 16, 2021 7:22pm
Whoever you are ryuryu, you must have some rather deep problems.
Real Trading is not gambling.
  • #793
  • Edited May 17, 2021 12:29am May 16, 2021 8:27pm | Edited May 17, 2021 12:29am
Quoting PeterCaleb
{quote} Since you seem to still be learning I will say this - whatever you deem true right now is true. Until, it is proven otherwise. A 5 pip move for a usual retail trader will yield 5 - spread (and possibly also minus commission). So 5 minus (up to 1-3pips). So do the math and see what you get. Same amount of work as any other trade but lower yield. You just need to keep learning and find your way. Peter
Scalping for me has a different meaning. For me trading a unit of 1 minute to 15 minute should generate atleast 10 pips. Two conditions : max 15 minutes min 10 pips. For this to work you have to choose a symbol which can generate atleast 2 pips each minute on a daily basis for 20 pc of ADR assuming it will be trending strongly in 1/5 th of 1440 minutes.

Now your sourcing or guessing of momentum period is very important. I always try to provide a certainity cover in an uncertain market for my brain to accept it easily. Working backward from a Gain or Loss target helps a lot.
Practice makes a person perfect
  • #794
  • May 16, 2021 10:38pm May 16, 2021 10:38pm
Indeed. Well put simnz. If people spent LESS time "trying to make money" (whatever THAT actually means in real life to someone) and more time spending time with the market, they will see there are LOTS of little nooks and cracks in different areas that a trader can work with. For me, about 95% of what I do is not very "impressive" re: shock and awe, however, people would be amazed to learn the amplification of your resulting "strike rate of success" that occurs for a strategy, when you stop thinking in linear terms.... Eg - a scalp vs a trend trade. I don't 'just draw lines on the chart willy-nilly or randomly'. Or use some magic as some try to suggest. It's about what the chart refers to "out in the real world". Something most lounge room traders simply have little or NO idea about. A "stock price" is the result not the beginning. Time also is the result NOT the start of it. But put them together and you CAN bake a cake or create a lovely looking trade.

As you stated - right place, time and position, for a nice ride where the market does most or all of the work. After all, you cannot reach through your computer screen and force the market to move in your favor.

Moral of the story - Have a genuine interest in what you're doing instead of staring at your bank account. You have MAYBE 100yrs to live Life so use your time WISELY.


Peter
Real Trading is not gambling.
  • #795
  • May 17, 2021 5:09am May 17, 2021 5:09am
Quoting TraderTim125
{quote} Order Flow and other interesting things Thanks Rick A couple of years ago I did some programming work for a fairly experienced trading colleague of mine. It was based around Order Flow (OF) and segmented profiling. At the time I didn’t feel he was quite on track as to where he was directing his project. To the best of my knowledge he never managed to integrate all the work we did into his day to day trading process. It was nonetheless interesting. From what I saw, this OF stuff seems to have significant potential for short term trading but...
I trade for entertainment and mental stimulation.
If I become a slave to indicators or signal arrows, do you think I will be able to enjoy it?
My enjoyment comes from practising the Pareto principle of the 80/20 rule.
That means I must not focus too much on making instant money but on finding flaws/situations/hours which can provide me chances of practising my 20% rule. It is not magic. It is planning. Backwards for a Profit Target. Forward for a Loss target. Setups that lay down targets with scaled-down expectations provide exponential returns (unintended) when you are able to get a kick out of auctioning process antics being played out by the cartels.
Particularly so when the market makers in order to inject life into otherwise dull situations start playing from both sides (range trading) and provide incentives to traders by using the Rotation technique where losers will be less and profit makers will be more.

I don't know Excel and no coding. Have been playing the trading sport for 36 years. So far it is working out well. Good entertainment and getting certificates of excellence in the form of dollars hold no particular attraction for a minimalist like me. Who is well taken care of by God to live 100 years with existing resources.

If you want I can share ideas for EA which uses no technical indicator. Semi-automated EA that can issue a 2-minute alert so that I can re-evaluate the situation and if feel no good, should be in a position to stop doing trade for a particular set-up. If I don't intervene, the trade is good to go. I will be using Highlight Candles and anchoring to some measurement of daily range to get a feeling of certainty.
My most enjoyable moments happen when I am able to cloth the randomness/uncertainty with a certainty garb.
Practice makes a person perfect
  • #796
  • May 17, 2021 5:42am May 17, 2021 5:42am
Quoting TraderTim125
{quote} Defining the bigger picture Hi Rick I would like to try and participate in this ongoing conversation about order flow etc but before attempting to do so I would also like to make sure that we are both on the same page in regards to some of the terms that you use. When you refer to "Big Players" I am assuming that you are talking about the dozen or so large commercial banks like Goldman Sachs, JPMorgan etc that account for the bulk of daily FX volume in what is generally referred to as the interbank market. My guess would be that this group...
Hi TraderTim

I spend 5-6 hours every night studying the order flow books and their data - I just trade what I see without assumptions.
Just my view for what's its worth.

Looking at EURUSD (its futures market twin), I see about 1 to 2 extremely large orders and about 10-15 large orders go through the order books each day. Then there is hundreds of mid size orders as well which really seem to be the real drivers on the market, the work horse of the big players objectives. Without doubt, at least 80% or more would be from those big players as you mentioned - but its what they are doing with them that's important, I see no value in determining who those orders belong too.

Expansion is totally volume related where trend is determined by the percentage of market order size over current limit order size x 100.
When get a percentage number higher than 300% in a series of executions within the same candle, we get a thrust breakout candle. Now's a good time to trade with the flow and stay in till the numbers flip.

Halting expansion is either performed by flipping of Market Buyers over Selling limit orders or Market Sellers over Buying limit orders by 300%+ on average
or
The big players place order blocks at the tip of a candle wick that's at least 500% larger in size than current market orders attacking liquidity.

Fracturing liquid pools is seen on charts and caused by market orders larger than receiving limit orders blowing out the top or bottom of the cluster without any pullback.

I suppose the theme here is for price to move, volume needs to be far larger than current receiving liquidity.
So the cheapest way to create a trend is to withdraw liquidity, rather than increase volume.
Trading thin liquidity at the boundary of the charts
  • #797
  • May 17, 2021 5:47am May 17, 2021 5:47am
Quoting PeterCaleb
. After all, you cannot reach through your computer screen and force the market to move in your favor.


So if you can't force the market move your favour, why there has been court cases, about several traders what has been accused move S&P500 Index futures for they favour. Tiny account traders, which has been in court.
  • #798
  • May 17, 2021 6:54am May 17, 2021 6:54am
Quoting kk100
{quote} So if you can't force the market move your favour, why there has been court cases, about several traders what has been accused move S&P500 Index futures for they favour. Tiny account traders, which has been in court.


Do you really want a serious response to that query? If you do not understand context, then I would suggest you take a break and go and learn about context.

When you start to think of the financial markets as "only" a machine then of course not knowing who is playing the game means nothing. But if you DO understand the different players and WHY they do what they do, then you can accurately anticipate where they will probably place their orders, ahead of time. I know it's real and true as I've been doing it for years now. I don't believe in reactive trading ... it's unsustainable. People who don't know history will always think they're invincible .... until they're not.

Peter
Real Trading is not gambling.
  • #799
  • May 17, 2021 8:50am May 17, 2021 8:50am
Quote
where they will probably place their orders, ahead of time.

Where the orders can be filled instantaneously without slippage.
But what if they use limit orders?
Then they will enter where they think the retracement has finished.
A trade should be based on an assumption based on facts
  • #800
  • May 17, 2021 7:38pm May 17, 2021 7:38pm
Quote
where they will probably place their orders, ahead of time.

Where the orders can be filled instantaneously without slippage.
But what if they use limit orders?
Then they will enter where they think the retracement has finished.


----------------------------------------------------------------------

People make MANY MANY assumptions and they are NOT necessarily an automatic gateway to facts and knowledge and insight and positive outcomes. "Retail traders" who have never seen how other participants trade or run their trade management do not understand that many do not go through a "broker" as retail traders do. Some indeed go through a bank or some other entity. But then there are other "middle men" who will do the order negotiation for them.

The more someone understands the market they trade, presumably, the more you would see where the LEAST amount of slipped orders has, does and probably will occur. Since most participants (who are very serious about what they do with their money) do not just randomly change strategies, there are routines that occur. See the routines and you have an insight that speculators do not.

I have tried many times to help people understand that a price chart is ONLY information and information can be tainted.

The speculator is only interested in either the micro OR the macro. But a value trader is someone who sees that you simply cannot have one without the other.


I hope that helps.

Peter
Real Trading is not gambling.
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