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Domino's Price and order flow trading

  • #1,021
  • Sep 23, 2010 11:54am Sep 23, 2010 11:54am
Quoting vicky_ag
Frank, looks like you are using true 1-2-3 and not the TTE. Cause with TTE it comes out like this too. Red line 1-2, yellow 2-3 and the lower break of 2 will triger TTE.

I am looking to trade it on 4hr charts. 30 mins is unfeasible for me.

Not to question domino but what I have read in the thread seems to be break of S/R, retrace to the line and then taking trades on the high/low break ie trend, retrace and continuation. Order flow mindset has still not set i.

Hey man,

I wasn't really trying to show TTE, nor was I trying to show how Domino trades. I also wasn't suggesting 30m to you....

My point was to address the issue you mentioned regarding "identifying the direction and applying 1-2-3" by sharing what I saw in front of me at the time.
  • #1,022
  • Sep 23, 2010 12:37pm Sep 23, 2010 12:37pm
Quoting frankkn
Hey man,

I wasn't really trying to show TTE, nor was I trying to show how Domino trades. I also wasn't suggesting 30m to you....

My point was to address the issue you mentioned regarding "identifying the direction and applying 1-2-3" by sharing what I saw in front of me at the time.
Buddy, dint say, you were. No accusations made . I just made a moot point that I am still unable to get that order flow mentality and that 4hrs is the lowest I can go. So, the problem is with me, nothing u said.

Your explanation was good but still dint clear my dounts as I am trying to trade TTE as compared to 1-2-3. Agreed that TTE break is confusing?
  • #1,023
  • Sep 23, 2010 1:38pm Sep 23, 2010 1:38pm
Quoting vicky_ag
Buddy, dint say, you were. No accusations made . I just made a moot point that I am still unable to get that order flow mentality and that 4hrs is the lowest I can go. So, the problem is with me, nothing u said.

Your explanation was good but still dint clear my dounts as I am trying to trade TTE as compared to 1-2-3. Agreed that TTE break is confusing?
Hm I think the tricky part would be which TTEs to take. I wouldn't take one in the chart you marked up because it wasn't in the right spot.

I like hornet's method of filtering TTEs using the price level at "2" in a 123.

For me, the 123 has to be in the right place ie. at the (potential) end of a rally on a smaller time frame within the context of a larger trend. In that case I'm comfortable taking the break of 2 provided that my volume analysis confirms supply/demand changing. I will add using TTEs that are filtered by hornets "2" thing..
  • #1,024
  • Sep 23, 2010 2:29pm Sep 23, 2010 2:29pm
Quoting frankkn
Hm I think the tricky part would be which TTEs to take....
Dint get the filtering part. Are you talking abt the High +5pips filter to entering trades?
  • #1,025
  • Sep 23, 2010 7:02pm Sep 23, 2010 7:02pm
Quoting frankkn
It's good to hear someone say that lol, I'm learning to just type their notes so I can regurgitate during the test, too bad I'm nearly done.



Makes perfect sense, I appreciate your taking the time to go over this stuff, it's actually pretty simple.

What route did you take when you graduated? I have plans with a financial planning firm when I graduate, and I'm not even sure if they'll let me trade with another broker.
i was trading before college but right out of college I just took some regular b.s jobs .. reduced my debt/bills to near nothing.. all money made was recycled into a trading account where everything was traded and invested.. I used long term charts and started to accrue a record.. I then as I was trading and building a record i wrote the business plan and did extensive research for my business.. which took about a year in 1/2 .. the more prep time and extensive plan you have the higher chance at being successful.
  • #1,026
  • Sep 23, 2010 7:18pm Sep 23, 2010 7:18pm
Just moved my SL to BE on my euro short, ahead of the next level. I might look for a TTE after this.

G2g my gf is giving me shit cuz all I do is trade and go to school lol I have way more questions but its not worth a night on the couch
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  • #1,027
  • Sep 23, 2010 7:28pm Sep 23, 2010 7:28pm
Quoting vicky_ag
That was not 16218, more like the high 16725.

So it means there are stops/orders at that high ?
16725 is where is it the break of 16218 is the long term trend resumption.. price failing at 16725 should push price through the lower order flow and trigger long term shorts. a domino effect
Quote
How to figure the B-Wave in there? I just see an A.

Edit: Zoomed in a bit. Got the B - Wave too. Though it raises another question, we are already at the downside and near historic low ..how does that play out? And we ignore gapped flows while deep into highs/lows ?? One more question, which TF you normally refer to for the resistance and touches?
monthly weekly and daily for entrance..
Quote
So far and forth on the naming convention , still to figure out how this ties into order flow.
orderflow is understanding and trading the flow of orders and the build and are triggered in the market. if price is rising in a long term down trend.. and people are buying.. where are they placing there stops??? at low breaks.. the later they have come into the market on the run the higher the stops will build on the low breaks the ones that are in longer are chasing the stops up as well.. as price rises the longer term frames will accrue pending orders with the trend.. so there is more interests at the major break points. watching orders the order flow build and distribute at these points is what its about.. open an orderbook and watch the orders flow through the market around these points.. thats the orderflow part. the price action is understanding the wave structure and flow of price and figuring out where to watch the orders pass through the market.. where it is important. price action gives u areas to watch.. order flow shows how the orders are built and distributed.. ranks the price action setup.. and helps understand how the money is moving at breaks..
Quote
I am learning to trade fundamentally but my entries suck, so thinking of improving them using order flow. Here's my chance
there should always be multiple reasons for a trade... fundamentally.. technically.. and psychologically and backed up with knowing the flow of pending orders.. for examples aud/usd...
interest rates are raising on aud .. usd is holding rates low.. debt is low in aussy debt is high in usd.. low debt and high interest rates .. so fundamentally aussy is a long usd is a short.. the flow of income from the interest rate is long.. so we know fundamentally to look for longs.. psych.. the region was oversold and if you refer to the psyc. wave pattern chart was in accumulation and capitulation phases.. so psych wise was ready for a long.. technically we were at strong support very high frequently touched zone.. and price failed at the sz and rebroke long.. if I had a view of the orderbook at the time if was against the sz and was breaking the previous wave high.. wed see lack of large pending orders on the sz and large triggering orders on the break high.. or a break on high volume and failure on low volume..
  • #1,028
  • Sep 23, 2010 8:00pm Sep 23, 2010 8:00pm
Quoting vicky_ag
Buddy, dint say, you were. No accusations made . I just made a moot point that I am still unable to get that order flow mentality and that 4hrs is the lowest I can go. So, the problem is with me, nothing u said.
you can go as low as you want.. but there is no efficiency in it .. and you cant build a business based on 15M trades.. trading as a business is all about reduction of risk..consistancy.. skewing reward and risk bell curves.. and creating efficiency on multiple levels to give u the highest advantages possible..
  • #1,029
  • Sep 23, 2010 11:03pm Sep 23, 2010 11:03pm
Quoting domino
Yes I will buy equities where the wealth is distributed and transfered to the investors side the more payments yearly the better for this reason I like trusts.. I do this globally so I dont really worry about not finding things that dont pay.. I also buy indexes and I really like to focus on emerging markets..
do you have an example of the decision making process you go through to pick equities to enter?
  • #1,030
  • Edited 4:47pm Sep 24, 2010 1:28pm | Edited 4:47pm
Stopped at BE on the last one.

Here's a possible TTE setting up on EU 30m

I'm hesitant because it's late on Friday

Edit: My volume analysis shows selling earlier today on the 15m and more recently no demand, but this could just be traders closing positions and taking profits at the end of the week.


Edit: I ended up putting in a pending order, and it was missed by one pip, good thing too.
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  • #1,031
  • Sep 25, 2010 10:08am Sep 25, 2010 10:08am
Quoting rogerdoger
do you have an example of the decision making process you go through to pick equities to enter?
here is a firm trade we made with a while back this is a good example..

this is riocan which is a Reit that pays monthly. it raises its rate every 11 months and continued to do this even with the current crisis.. if you caught the upper down trend breakout like whats seen in this first pick you would have been buying riocan with a 25% yearly dividend paid and compounded monthly..

the chart here compressed at the 10-11$SZ6L and brokeout at 12.47-12.75$ dependind on the chart.. so our initial buys started at 12.60 with stops at 8 .. chasing wave lows as the price action builds.. and continuously buying into the trade until income stream becomes low.. 3-6%ish

the 2 buys worth taking ar the initial breakout around 12.60 and the outside wave break from support zone at 14$ which is continuation.
we are currently still holding this with stops around 16
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  • #1,032
  • Edited 1:59pm Sep 25, 2010 1:33pm | Edited 1:59pm
Hi Domino

First, let me thank you for spending time and explaining things so patiently. I just wanted your opinion on couple of things(may not be directly related to your teachings).

I trade futures(don't trade Forex) and I have access to the following:

 

  1. Volume for QUOTES(Bid/ask)
  2. Volume for Executed Trades(Bid/Ask)

I use the Quote Volume to identify Supply/Demand areas and
Executed/Market Volume for the momentum.

I am still learning but would like your opinion of how you would use the above data to read the market?

Thanks again for your time.

Thanks to Rocky!
  • #1,033
  • Sep 25, 2010 10:16pm Sep 25, 2010 10:16pm
Quoting domino
here is a firm trade we made with a while back this is a good example..

this is riocan which is a Reit that pays monthly. it raises its rate every 11 months and continued to do this even with the current crisis.. if you caught the upper down trend breakout like whats seen in this first pick you would have been buying riocan with a 25% yearly dividend paid and compounded monthly..

the chart here compressed at the 10-11$SZ6L and brokeout at 12.47-12.75$ dependind on the chart.. so our initial buys started at 12.60 with stops at 8 .. chasing wave...
thanks for the reply, do you have some sort of scanner which is giving you an indication of possible compression or do you go through them manually?
  • #1,034
  • Sep 26, 2010 12:01am Sep 26, 2010 12:01am
Quoting Nritv
Hi Domino

First, let me thank you for spending time and explaining things so patiently. I just wanted your opinion on couple of things(may not be directly related to your teachings).

I trade futures(don't trade Forex) and I have access to the following:

 

  1. Volume for QUOTESid/ask)
  2. Volume for Executed Trades(Bid/Ask)

I use the Quote Volume to identify Supply/Demand areas and
Executed/Market Volume for the momentum.

I am still learning but would like your opinion of how you would use the above data to read the market?...


My opinion is your asking about price accumulation and market profile aspect of trading.. which im quite fond of but is beyond the scope of what im trying to accomplish in this thread.. a great resource to start would be the chicago board of trade manual for market profile written by steidlmayer... after conducting many years of market research and who is the pioneer for this type of study.. generally low volume areas and price action that fail in low volume areas and break on high volume move to high volume areas as volume acts as an attractor for price..

my opinion on how to use such information would be to watch volume transacted and orderbook as price is failing around known S&R and watch for the breakout with resumption on high volume as a confirmation .. look at the example above as riocan was breaking out long at 12.60 volume was higher than normal or changed from decreasing volume to higher volume.. this was a breakout on high volume after failing on decreasing volume... and as low volume acts as s&r it proved the SZ at 10$...

for more information anything by steidlmayer is great..
  • #1,035
  • Sep 26, 2010 12:04am Sep 26, 2010 12:04am
Quoting rogerdoger
thanks for the reply, do you have some sort of scanner which is giving you an indication of possible compression or do you go through them manually?

ill do basic scans for increasing yeild decreasing price.. generally gives a good set of patterns for sorting .. write them down .. and then go through the fundamental research.. after that .. fundamentals check out and yeild has a good track record of consistancy and raising .. the ta can take over and that is done manually.. but youll get a good list that way.. continually scan to because things will drop quickly some days and become good buys..
  • #1,036
  • Sep 26, 2010 1:17pm Sep 26, 2010 1:17pm
Quoting domino
you can go as low as you want.. but there is no efficiency in it .. and you cant build a business based on 15M trades.. trading as a business is all about reduction of risk..consistancy.. skewing reward and risk bell curves.. and creating efficiency on multiple levels to give u the highest advantages possible..
Domino what I meant for me the feasibility of low tf stops at 4hr. I have a full time job in India. By the time I return tired from work it is US noon session which gives way to less of action in the intraday scenario.

My preferred tf is daily, trading currently on 4hrs.
  • #1,037
  • Sep 26, 2010 2:11pm Sep 26, 2010 2:11pm
Quoting domino
16725 is where is it the break of 16218 is the long term trend resumption.. price failing at 16725 should push price through the lower order flow and trigger long term shorts. a domino effect
monthly weekly and daily for entrance..
So 16725 is the support we are looking at and 16218 is the low. So downtrend....low at 16218....retrace...and the break of previous low 16218 to start the downtrend.

Quote
orderflow is understanding and trading the flow of orders and the build and are triggered in the market. if price is rising in a long term down trend.. and people are buying.. where are they placing there stops??? at low breaks.. the later they have come into the market on the run the higher the stops will build on the low breaks the ones that are in longer are chasing the stops up as well.. as price rises the longer term frames will accrue pending orders with the trend.. so there is more interests at the major break points. watching orders the...

So you mean, in an uptrend ppl tend to put stops at previous lows (HL higher low in trend sense)....those who have joined the trend early chase stops to higher HL...those who join late have their stops at their HL and they chase HL too...so on a long trend we have high interests at these HL/low break points. Watching orders at these points will help us understand the order flow. Wave patterns and price flow helps with PA giving us the break points for watching the order flow. Then order flow helps us rank the PA setup, if it is worth or not.

Sorry if I mis-understood anything.

Questions I have:

1. From above at a low break we have huge number of stops. The stops if triggered will cause a one way movement of the market ie down. So watching stop sizes (in form of pending orders ) at the low breaks enough? Or frentic selling when price nears the break a giveway ? Then there are market participants convinced on the upward movement causing the retrace?? Sorry just confused.
If possible please explain taking the GBP/AUD trade. 16725 is the high and 16218 is the low break.


2. Speaking orderflowly ppl tend to try and break S/R which creates the touches. So Number of touches you think is important? 3-4? Minimum touches you look at ?

3. Wave sizes. I understand that gapped order flow is ignored normally but is considered near lows/highs. But still what wave numbers you look at ?
D? G ?

Quote
there should always be multiple reasons for a trade... fundamentally.. technically.. and psychologically and backed up with knowing the flow of pending orders.. for examples aud/usd...
interest rates are raising on aud .. usd is holding rates low.. debt is low in aussy debt is high in usd.. low debt and high interest rates .. so fundamentally aussy is a long usd is a short.. the flow of income from the interest rate is long.. so we know fundamentally to look for longs.. psych.. the region was oversold and if you refer to the psyc. wave pattern chart...

Domino, I am looking not only at interest rate differentials but also at the GDP growth, current balance, deficits, investor confidence etc.

Technically, nothing more than S/R but that too arbitary......nothing which looks to touches.

I am trying to trade the BWILC way. Xaron is a member here who trades this way.
Learning order flow to fine tune my entries.

Agreed on the A/U interest differential part. You think current oversold scenario as accumulation and capitulation phases (VSA terms??? )Though I have a different way of looking at the current oversold scenario:
The RBA governor's hawkish tone on the growth aspects had raised hopes of more interest hikes. This caused rally into A/U. Upmove
The RBA minutes discussed a possibilty of a hike but not in the near future. This caused a bit of mix up for ppl anticipating a hike, hence the soldout. Retrace
FOMC meeting added another round of QE and another round of useless dollars into the market causing dollar depreciation. Trend Resumption

You see psych waves, I see fundamental news. Same view, different reasons.

In the post you surely meant rz instead of sz.

You are using VSA too?
  • #1,038
  • Edited 7:15pm Sep 27, 2010 4:28pm | Edited 7:15pm
Quoting domino
+1700p on usdmxn now.. we are looking for continuing failure here into lower resistance and watching the price action for swaps.
+3800p on usdmxn now .. broker long term break point continuing failure here into support with resistance building above watching the price action and support zones.
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  • #1,039
  • Sep 27, 2010 9:11pm Sep 27, 2010 9:11pm
Quoting domino
ill do basic scans for increasing yeild decreasing price.. generally gives a good set of patterns for sorting .. write them down .. and then go through the fundamental research.. after that .. fundamentals check out and yeild has a good track record of consistancy and raising .. the ta can take over and that is done manually.. but youll get a good list that way.. continually scan to because things will drop quickly some days and become good buys..
cool, do look at the yield vs price using an online resource?
what is a good list to look at to start out with?
  • #1,040
  • Sep 28, 2010 8:47am Sep 28, 2010 8:47am
Quoting rogerdoger
cool, do look at the yield vs price using an online resource?
what is a good list to look at to start out with?
well price is already factored into yield because yield is dividend or interest payment at the current price.. but I do look at yield and the price action around our SZ and RZs. using and excel sheet I track the payments and announcements and actual payments and draw out charts .. its better to calculate your own yield rather than looking at online resources because they are always wrong on most equities.

I cant give you a list of equities that would be trade secret... a good example to find more like would be RIOCAN Reit... understand why that one rocks.. and you have a solid set of things to look for..
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