Stating The Obvious and The Quest For Wisdom

I'd much rather play it on the Eur/jpy: buy 123.90 , tp at 130.00, no stop

Thats a pretty subjective statement given the not-so-well-defined concept of "order flow"

Is it subjective because like Darkstar said orderflow trading is a mindset. Even if you are an orderflow trader you still need to mold that style of trading to fit your personality.

Just as each technical analysis trader has his own way of entering and exiting trades so do orderflow traders. You can have 10 orderflow traders and they each consume liquidity at various points throughout the day/week. Some of them can be in competition with each other for the liquidity, some of them aren't.

Again it is subjective because if you asked orderflow traders why prices did what they did they can come up with some different answers. Every person be it a TA trader, Fundamental trader, orderflow trader has their own definition of WHY price did what it did. Whose interpretation is correct? Well you can never know for sure because you can't see who is making every trade as well as know exactly what is going through their head. However there are many times you can discover a pretty good reason.

Orderflow trading is a journey of personal discovery, development as well as market discovery. You can look at the information that appears on a chart, but more importantly look at the information which doesn't appear on the chart such as news, economics, politics, market sentiment, stops, option barriers. You can look at what is going on economically on a global scale etc. All of the information is available publicly so as many other people said it's about putting the pieces of the puzzle together.

This process can take a long time as you are going through the personal discovery process as well. For me it took about 6 months and around 1,000 hours before I felt confident that I knew the reason WHY prices was doing what it was doing. Then add another 4-6 months to refine your strategy and get your psychology and money management straightened out and you can become successful. That's not to say that with 2,000 hours you can become successful. It's more around 5,000 hours ++ as I spent a good 2 years messing around with expert advisors, technical indicators before I even discovered order flow trading. For some people getting through this process can be the most difficult because they struggle to determine with conviction why price did what it did. They struggle to capture and explain to themselves the market variables that occur. Once you learn what orderflow trading is and you spend some time on it your view of what exactly it means begins to change as you start to mold it to fit your personality.

I guarantee you that your view/interpretation/meaning of order flow trading is much different once you spend a few months on it. Some people may never truly understand what order flow trading is beyond the textbook definition. You need to enshrine it into your mentality/way of thinking and personality.

Once you start learning WHY price is doing what is it doing you need to start making some judgment calls about what is affecting the market and what is NOT. You need to be able to say with a high degree of certainty that this variable or series of market variables moves the market. You start to learn what is dominant theme that is in play. You start to learn what is important what is not important and most importantly the market environment that is required to render certain variables in play. You begin to play out in your mind various scenarios for different countries and how that would play out in the currency markets. You learn what are the variables required to cause a rise and fall. You learn what are the risks to the upside and the downside and play out the scenarios in your head. You learn why the market can ignore this variable one day and then the next day it is in in play again. You can watch a interview of a trader/investor and determine fairly quickly whether they are right or wrong in their interpretation of WHY the market is doing what it is doing. You start to get a 'feel' for the market and a certain intuition/subconscious market understanding. You need to be very careful not to confuse these with the emotions of fear/greed.

The answer to the above questions can differ substantially from trader to trader because trading is a very personal experience but at the end of the day each trader needs to have the conviction to place a trade and say I know with a high degree of certainty that the order flow will come in and validate my analysis.

There are of course days and time periods during the year when I have absolutely no idea why price is doing what it is doing. It is either because something is happening which I have not learned about yet, in which case the market learning process continues and you get a better 'feel'. Or it is because the market is legitimately acting very weird and you stay out of the market until you can figure out what is going on which usually happens after a few days or a week.

That's my wisdom and trading journey. Take what you can from it. Hope it helps.

Very interesting, thank you.

Can I ask you some questions? What was your education and occupation before becoming a successful trader? And, can you recommend any useful reading?

Regards, Leon

to go back to DS chart, he bought A/U at around 0.8650

but I feel the chart has nothing to do with that trade.....turmoil about Greece but that will all blow over......do you really think that the euro countries will let Greece fail??...........but in the meantime the price is dropping like a stone...........when price is near the bottom, wouldn`t you buy?

Yeah I think we are about done with the reading part. I think it is time to observe and act. I think this is the only way we are going to get there.

I should have elaborated.

Reading on testing an edge, interpreting fundamentals and economic factors, maybe something on correlation. There are plenty of other blank spots in my knowledge. For those of us who who have commitments during prime trading times, at least for now, reading is all we can really do.

EDIT: The more I think about it the more ludicrous it reads; done with reading? I very much doubt it.

Nvm that was a stupid statement lol. Just that nothing one reads teaches experience so the time seems like its best spent watching news sources and looking at the chart. And just trading by making educated guesses.

On that note I have a book for you idk if you have read it. I'll PM.

this is a "two bar pinbar" os something like it. And Mike, Darkstar pupil said that uses only Price Action nowadays.

i am not imortal to make enough money with increase of 2% month. Neither i have enough money to throw at Forex market wich a strategy that is inefficient like this.

for me, given the movement Forex does 24 hours a day, a system that gives only 2% a month (for a account bellow 1 million) is inefficient and prone to fail.

2% is fantastic if you have a high probability that it will occur, but i believe a system that delivers only 2% problably has a small edge and it is gamble.

if one trades in this way and think that it is safe, then he is trying to use a paper cup as a holy grail. The holy grail does not exist.

You have a quote somewhere to back that up? I just talked to him last week and he gave me a different impression.

maybe i am wrong in the "nowadays" He ssaid this to me at the end of 2008, i think. But he said more recently (in the Beind oder flow thread maybe? I don't remember") that was good to know everythink he knows but it was not necessary to trade profitable.

EDIT: BTW, i am only revealing what he said to me in pm because he said in public too.

what he said is that he was not trading this due the TIME necessary to trade this way. I don't knwo if now he have time again and is trading thiis style.

Scotty just finnished to read the entire thread and you have done a tremendous work here

you put a lot in this I can smell it

Just to add some insighs that I have grab along my journey,maybe someone will find it useful,I must to prevent all of you who read this post that those are purely my judgements so you can agree/disagree with it.

I'm in opinion that YOU MUST GET THE CONCEPT OF MARKET STRUCTURE RIGHT TO UNDERSTAND THE CHARTS,and this will be also the KEY for achieving the necessary mental skills everyone would need.

The esential key building up confidence is to understend price behavior and the rules that govern trading only then you will can defeat those bad mantal issue that cause you to don't be consistently profitabile.In order to achieve the necessary mental skills I'm in oppinion anyone must know how markets really work befor they grab any analitical skills.

When I talk about analitical skills I'm reffering at the same old basics stuff based on price behavior nothing fancy or any sophisticated systems.

The vast majority of those who post on the forums are wasting their time,I know that this may sound harsh.don't want to hurt anyone's feelings.

What is my advice for you,is to make some research in understanding of the micro-structure of the market.It may be a dangerous road because out there his a lot of misleading and you must read between the lines use your brain and you will be amazed by the consequence,sky it will be the limit, dreams will come true.

I was just offering my views,and I don't claim that I have grasp all the details from the market structure and that I'm an expert but I'm smart enough to understand it.

if you believe in yourself,have dedication and never quit,you will be a winner at the end,The price of victory is high,are you willing to pay it? but so are the rewards.

hope someone find it helpful

all the best!!

I don't want to sound like a knowall guru, appologies if i do, but how do you know it was a "bottom"??
One of the greatest steps in learning this market is when you know what you would've done at the time, without the benefit of hindsight..
in other words the "now" not the "then", does it make sence?
i'm not that good with words.

I wish darkstar would write a book!

Mike is a proponent of J16 style so of course he would say that DS teachings weren't the only way to trade profitably... but I have never seen him say he doesn't use DS teachings anymore. He takes every opportunity to thank DS and in fact I think his only post in the Behind orderflow thread was to say "PS DS is a very nice guy"... so I think that debunks that. I believe DS more than anything taught Mike a mindset adaptable and flexible.

2 million without stop? You remind me of "Xaron". This guy traded without S/L in 2008 and ended doubling his equity in 7-8 mths.

http://www.forexfactory.com/showthread.php?t=204758

I am not sure whether his method included order flow trading or not.

BTW, DS from the looks of it, you are trading based off fundies. I think you will like this thread too:

http://www.forexfactory.com/showthread.php?t=216097

I am reading a book called "Intermarket Currency Analysis" by Ashraf Laidi which was recommended by the thread starter. Looks a gud book.

pornographic?

Yes, you see the golden hands that have already come in. If money flow/orderflow/bets work as votes to determine market value (future prices) then certainly some weighty votes are in the ballot box already. I was looking at a very short term setup last night (that short I mentioned) which was worth ~30 pips. Longer term, we are in agreement. There's a good chance, close to 99.9%, that you and I are looking at differant data, but I had the opporutunity a while back to pick the brain of a guy who is the real deal-he's been a successful fulltime trader for 10+ years, and when I presented to him what I was using he laughed and said I was right on track. I say that not to brag, but to say that you and I need to skype and shareview sometime, Darkstar. If you have some time, I'd like to show you what I'm doing. You can call me an idiot and that will be the end of it.

I'm glad to see you say that when we put on a trade, there's really no guarantee it's gonna be a winner. Even with the best data, expectations-whatever, we have to be ready to hit the kill switch if the deal goes bad.

I agree also that simply knowing market mechanics is not enough, but if you know the mechanics then you can in a sense 'read' what has happened already and use that information to infer what will likely happen next. I beleive this is exactly what you did in the AU trade. I'd love present evidence as to why I beleive that, but I can't do it here. Anyone who is willing to dig a little could figure it out though. To me it's all about inferances that you make and caustiously act on.

The feedback you are giving has been very helpful. I've been leaning towards the common sense way of thinking, but you're right, there's still a part of me that want's to see A happen, then B, I do C and I'm in profit. Really though, when you start frying your retnas/brain/life/family for those 30 pips a day, it's not worth it. Just ride the trends so you can free yourself to go out and work on your rental properties, reasearch other investments, get out of the house ect; hence the purpose of this thread.

Thank you everyone for thoughtfully participating here.

Scotty

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