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Domino's Price and order flow trading

  • #1,221
  • Dec 6, 2010 5:13pm Dec 6, 2010 5:13pm
breakout on increase of volume.. to tell if its a bull/bear snap or legit.. wave breakouts on low volume.. can directly mean that there is not enough interest in this break and not to many people really give a $h!t odds are if price doesnt rally within the next few bars after the break with slowly increasing volume .. you maybe in a good for nothing trade.. Breakouts on High volume can mean several things depending on the price structure.. if price is COMPRESSED a breakout on High volume only when matched with rise in the liquidity in the market for the trade can mean powerful rallies and trending.. but if price is not compressed and breaksout on high volume and liquidity is is absorbed in the market and isnt quickly paired can mean demand side only shakeouts.. bull/bear snaps and last pushes before resuming in other direction.. this is limited demand and is not sustainable.. breakouts with higher than normal traded volume where price does not fully sell down into congestion or is compressing.. is the most sustainable.. this is accumulation stage within the compression and rising volume on the breakout shows a start in increasing demand on the break and sight by other traders.. who then will start building into the trade.. the more the market is matched on both side on the break the higher the stability the better the quality of demand in the market..
  • #1,222
  • Dec 6, 2010 5:30pm Dec 6, 2010 5:30pm
relating this to what we do....

so by hunting for resistance zones..that have high noticability among traders.. aka those points like SZ10 where there are 10 distinctive market reactions to that price.. we can gauge two things.. as price approaches the SZ10 on high volume pullsback on low volume and breaks the sz10 on increasing volume we can see that the price action is telling us not to accumulate at this SZ10 because the volume is confirming the break... on the other hand if price begins to slow to the SZ10 and volume begins to die... this SZ10 is being shown as a point where supply is fading away and equilibrium is forming .. like compression waves... as accumulation occurs at the SZ10 and the high is breaking on increasing volume.. then we can assume that the break is legit and is providing us with a good ability to enter the trade with increasing demand..

generally with the orderflow of the trade and reading it.. as price slows and begins fighting with the SZ10 from higher up it increases more order cluster nodes.. the more price fights with SZ the more nodes form.. the higher the orderflow number.. the higher this number is the high quality of the trade as defined by the market.. orderflow A means that there was no fight on the demand side of the market as price approached the SZ and is so a less quality trade.. while SZ10J means price faught the whole way down and as price pushes against the SZ supply will dry up with increasing demand and volume on will increase as new market participants enter the market demand sided..
  • #1,223
  • Dec 7, 2010 7:38am Dec 7, 2010 7:38am
Hi Domino, Thank you for your posts, I'm a silent follower of your thread. I've learned a lot from it. It's not so easy though because I had accumulated so many bad habits/misconceptions over time. For example, the way you explained about order clusters and gapped order flow is an eye opener. I'm not so sure I understand how you determine high from low volume though, just as you described it in post #893 or is there anything else? I want to thank you again for your time.
  • #1,224
  • Dec 7, 2010 6:33pm Dec 7, 2010 6:33pm
Quoting OGW
Hi Domino, Thank you for your posts, I'm a silent follower of your thread. I've learned a lot from it. It's not so easy though because I had accumulated so many bad habits/misconceptions over time. For example, the way you explained about order clusters and gapped order flow is an eye opener. I'm not so sure I understand how you determine high from low volume though, just as you described it in post #893 or is there anything else? I want to thank you again for your time.
your welcome OGW,
You can tell the volume in spot markets by the size of the bar most of the time.. the bigger then bar usually the more volume.. also the time of day has alot to do with volume.. you can also get a better volume picture using futures data as well..
  • #1,225
  • Edited 8:53pm Dec 7, 2010 6:43pm | Edited 8:53pm
first risk adverse trade youve seen me take.. brought us a 4 hour/3 setup on EURUSD the aim of this short is longer in term but played on low TF...

heres what we got...

RZ5G-Swapped and compressed at 13444 Order flow is smooth and confluence is stacked waiting for asian to read volume on break..

RISK adverse trade not with IRD but IRD is very small

edit: some grammer
  • #1,226
  • Dec 7, 2010 9:38pm Dec 7, 2010 9:38pm
if anyone wonders what order flow trading is.. go to google.. type in order flow trading and click on the 5th link down.. oh yeah thats this thread..
nice to see i made it into googles top 5 for order flow trading searches
  • #1,227
  • Dec 7, 2010 10:40pm Dec 7, 2010 10:40pm
Quoting domino
if anyone wonders what order flow trading is.. go to google.. type in order flow trading and click on the 5th link down.. oh yeah thats this thread..
nice to see i made it into googles top 5 for order flow trading searches
AWESOME! lets see how long it takes to go to no. 1!
  • #1,228
  • Dec 7, 2010 10:44pm Dec 7, 2010 10:44pm
Quoting domino
first risk adverse trade youve seen me take.. brought us a 4 hour/3 setup on EURUSD the aim of this short is longer in term but played on low TF...

heres what we got...

RZ5G-Swapped and compressed at 13444 Order flow is smooth and confluence is stacked waiting for asian to read volume on break..

RISK adverse trade not with IRD but IRD is very small

edit: some grammer

  • #1,229
  • Dec 8, 2010 7:49am Dec 8, 2010 7:49am
possible L type wave structure which means low volume push against resistance(RZ10G-swapped and in process of compressing).. and usually followed high volume confirmation on break..

If this breaks low again and pushes then we have beginning of expansionary wave cycle on this set on increasing volume which means trend is intact short off of higher frame resistance.. and we will see resumption of large waves down...
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  • #1,230
  • Dec 8, 2010 8:25am Dec 8, 2010 8:25am
anyone looking at bond auction news... germany bond auctions starting to dry up again.. last time this happened EU hit 1.19
  • #1,231
  • Dec 9, 2010 7:11am Dec 9, 2010 7:11am
Quoting domino
possible L type wave structure which means low volume push against resistance(RZ10G-swapped and in process of compressing).. and usually followed high volume confirmation on break..

If this breaks low again and pushes then we have beginning of expansionary wave cycle on this set on increasing volume which means trend is intact short off of higher frame resistance.. and we will see resumption of large waves down...
eur/usd formed L type wave structure but broke high on increasing volume.. failed on upper resistance low volume and then made new lows on increasing volume.. bear trend is expansionary but PA is chopped moving stop to BE to protect
  • #1,232
  • Dec 9, 2010 9:25am Dec 9, 2010 9:25am
Quoting domino
possible L type wave structure which means low volume push against resistance(RZ10G-swapped and in process of compressing).. and usually followed high volume confirmation on break..

If this breaks low again and pushes then we have beginning of expansionary wave cycle on this set on increasing volume which means trend is intact short off of higher frame resistance.. and we will see resumption of large waves down...
making new lows on high volume in here.. trade is lookin good.. I really hate taking these counter IRD trades even when rates are tight... edit: end of year squaring is starting for us here.. i assume thats whats making this wave structure is other firms doing so as well.. so we are going cash on most positions to watermarket numbers and do end year accounting.. no more trades till next year guys... after this euro one

expansion targets need to be past 3100 for this trend to have technical expansion..other than that stops are at breakeven so enjoy
  • #1,233
  • Dec 12, 2010 11:12pm Dec 12, 2010 11:12pm
Nice thread you've got going here domino
Annoying Precision
  • #1,234
  • Dec 15, 2010 5:21pm Dec 15, 2010 5:21pm
Ok some new fun stuff...

Fundamental triggers..

We use these for Large Long term Carrys and driving factors in trading decisions... The inflation rate differential is a rarely used trader tool that is quite accurate at spotting changes in IRD's Before they occur.. Simply because rates are adjusted to either mellow out or increase inflation rates.. So if a pairs Inflation rate differential is increasing you can bet the IRD is just behind waiting to follow.. confirmation of the Inflation rate differential is the IRD and as these are generally cyclical they can provide us with directionality for our trading.
  • #1,235
  • Dec 16, 2010 8:59am Dec 16, 2010 8:59am
watching USD/MXN around these points.

looks like RZ11F-Swapped and Compressed daily with IRD
12.50345

starting to form almost a death roll

but if we look at the time on it.. the break looks to be around Xmas which means this may be low volume manipulation
  • #1,236
  • Dec 16, 2010 9:12am Dec 16, 2010 9:12am
Any links to this tool or more literature? Seems to make sense....
Quoting domino
Ok some new fun stuff...

Fundamental triggers..

We use these for Large Long term Carrys and driving factors in trading decisions... The inflation rate differential is a rarely used trader tool that is quite accurate at spotting changes in IRD's Before they occur.. Simply because rates are adjusted to either mellow out or increase inflation rates.. So if a pairs Inflation rate differential is increasing you can bet the IRD is just behind waiting to follow.. confirmation of the Inflation rate differential is the IRD and as these are generally...
Annoying Precision
  • #1,237
  • Dec 16, 2010 9:40am Dec 16, 2010 9:40am
Quoting erikte279
Any links to this tool or more literature? Seems to make sense....
I dont know of anyone that uses this other than us... Its in our training manuals for new traders.. Ive used it for trading for a long time now using it as a major long term trend indicator.. when the inflation rate differential starts to spread generally its followed by price rallies and interest rate differential change.. We plot the inflation data in excels to see the differentials and we relate them to the Interest rate differential .. if the inflation data starts to widen and the Interest rate data was narrowing .. we have divergence in data.. and divergence creates profit.. generall since its cyclical we can get a year or 2 out of the cycle without worrying about sudden changes in underlying market factors.. altho as far as I know.. no one else does this.. and It may be the fact to why its still leading market cycles
  • #1,238
  • Edited 12:44pm Dec 16, 2010 9:49am | Edited 12:44pm
Quoting domino
I dont know of anyone that uses this other than us... Its in our training manuals for new traders.. Ive used it for trading for a long time now using it as a major long term trend indicator.. when the inflation rate differential starts to spread generally its followed by price rallies and interest rate differential change.. We plot the inflation data in excels to see the differentials and we relate them to the Interest rate differential .. if the inflation data starts to widen and the Interest rate data was narrowing .. we have divergence in data.....
do u guys use oanda order book , i find it very useful (domino)
  • #1,239
  • Dec 16, 2010 10:23am Dec 16, 2010 10:23am
Where is this manual?

Thanks

Quoting domino
I dont know of anyone that uses this other than us... Its in our training manuals for new traders.. Ive used it for trading for a long time now using it as a major long term trend indicator.. when the inflation rate differential starts to spread generally its followed by price rallies and interest rate differential change.. We plot the inflation data in excels to see the differentials and we relate them to the Interest rate differential .. if the inflation data starts to widen and the Interest rate data was narrowing .. we have divergence in data.....
Annoying Precision
  • #1,240
  • Dec 16, 2010 2:58pm Dec 16, 2010 2:58pm
Quoting erikte279
Where is this manual?

Thanks
its at the firm.. its proprietary firm only
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