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Order Flow - Achieving the mindset

  • #501
  • Mar 1, 2011 5:57pm Mar 1, 2011 5:57pm
i feel like an idiot reading some of these posts..way over my intellect
  • #502
  • Mar 1, 2011 6:14pm Mar 1, 2011 6:14pm
Quoting redbaron1981
Deals like the Prudential one above do not come around every day but is there enough large size corporate deals carried out daily to be able to trade off or are we as order flow traders only able to work on the knowledge that there maybe large orders placed in defense of option barriers and push into them.
For now, the knowledge of exotic option levels/expiries is enough to keep me busy.

Quoting redbaron1981
The more and more I think the more I see the chart becoming useless apart from reference purposes.
Agreed

Quoting redbaron1981
Darkstar if you need a proof reader let me know
Ditto
  • #503
  • Mar 1, 2011 9:01pm Mar 1, 2011 9:01pm
Quoting redbaron1981
[font=Calibri]Darkstar,

Thanks for your response and glad to hear your books nearly finished....
np
Time hides Nothing
  • #504
  • Mar 2, 2011 3:37am Mar 2, 2011 3:37am
This is an old film but worth the watch. It just goes to show what the dealers may be thinking.

All the parts are on youtube.

Inserted Video
  • #505
  • Mar 2, 2011 5:02am Mar 2, 2011 5:02am
Corporate flows - for those wondering what that looks like - right now, EU, buying linked to Euro 2bn M&A. It's not the only reason it's going up of course, but explains why the retraces are virtually non-existent.

good old school film RedB btw.
  • #506
  • Mar 2, 2011 5:32am Mar 2, 2011 5:32am
Corporate flows?? From what I get, I don't think thats what we should be looking at, for the most part. If it's some massive deal, maybe something to think about.
  • #507
  • Mar 2, 2011 5:38am Mar 2, 2011 5:38am
Easy! I'm not saying you trade that (how would you? It's only 2bn and only smooths out a few bumps) but thought it was worth mentioning as it was right this second.
  • #508
  • Mar 2, 2011 6:01am Mar 2, 2011 6:01am
Quoting triphop
Easy! I'm not saying you trade that (how would you? It's only 2bn and only smooths out a few bumps) but thought it was worth mentioning as it was right this second.
Well 2bl could make it move some I would think....

Is this what you're talking about:

1145 GMT [Dow Jones] The euro is certainly back in favor Wednesday despite the risk-aversion drivers that weighed on it overnight still being present. The Saudi stock market has shed another 5% this session and European equity markets are trading 1% lower, gold is close to record highs and oil close to 2 1/2 year highs. However, M&A related buying seems to have come to the euro's rescue with the market chat being of Middle East buying to the tune of around EUR2billion. EUR/USD hit 1.3843, EUR/JPY 113.40, EUR/GBP 0.8488 and EUR/CHF 1.2811 in Europe, all highs for the day. ([email protected])

Anyway i didn't trade last night but I remember hearing of big bids at 3760, then later on, talk of leveraged accounts selling into it, with a swiss name on the bid again around there.

You didn't need any of that to know it's a good buy down there if you ask me.
  • #509
  • Mar 2, 2011 6:11am Mar 2, 2011 6:11am
Just heading to school so I don't have time to post much, but I believe corporate activity, like M&A and investments could be a powerful tool in our order flow arsenal...

LONDON/NEW YORK, March 1 (Reuters) - U.S. power firm PPL Corp (PPL.N) is buying German utility E.ON AG's (EONGn.DE) UK power networks for 3.5 billion pounds ($5.6 billion) in cash to create one of the largest electricity distributors in Britain.
PPL, which beat a rival bid from Hong Kong billionaire Li Ka-Shing according to people familiar with the matter, would also assume 500 million pounds ($800 million) of debt.
What would you do?

The EUR/USD is something to do with Qatar and Spain to the best of my knowledge.

Be back soon guys! Exciting stuff!
  • #510
  • Mar 2, 2011 6:17am Mar 2, 2011 6:17am
Quoting Monroe
Well 2bl could make it move some I would think....

Is this what you're talking about:

1145 GMT [Dow Jones] The euro is certainly back in favor Wednesday despite the risk-aversion drivers that weighed on it overnight still being present. The Saudi stock market has shed another 5% this session and European equity markets are trading 1% lower, gold is close to record highs and oil close to 2 1/2 year highs. However, M&A related buying seems to have come to the euro's rescue with the market chat being of Middle East buying to the tune of around...
The same - IFR had it a little earlier at 10:50. As for how much 2bn moves - who knows. I think of around $100mn a pip in Lon/US ish but then again, some days 100m options can hem in price all day, others doesn't dent it. I would guess it's all done now though.

I agree a lot of that is noise. Helpful noise though.
  • #511
  • Mar 2, 2011 6:21am Mar 2, 2011 6:21am
Quoting xXTrizzleXx
Just heading to school so I don't have time to post much, but I believe corporate activity, like M&A and investments could be a powerful tool in our order flow arsenal...

LONDON/NEW YORK, March 1 (Reuters) - U.S. power firm PPL Corp (PPL.N) is buying German utility E.ON AG's (EONGn.DE) UK power networks for 3.5 billion pounds ($5.6 billion) in cash to create one of the largest electricity distributors...
But how would you know,when the orders of this particular deal would come through.I mean the timing of this? Isn't it to late by the time this sort of thing hits the public?
  • #512
  • Mar 2, 2011 6:43am Mar 2, 2011 6:43am
Quoting redbaron1981
So these are the size of transactions we need to be aiming for to climb on the back of, as I am fairly certain that market impact could not be avoided with a transaction so large. The next thing to look out for is how an order off that size would have been made and how we could have had pre warning about it. In these two cases it seems that the market started to move on speculation alone and no actual $35.5 Billion ever hit the market. "Buy on rumor Sell on news" certainly comes to mind.
Ummm i dont think so. U cant get to know of these deals until u dont have a guy inside the institution. So forget about the down move on 1st march and up move on 1st june.

But i am more interested in the bold part in ur post so we can get in the moves happening after the events look at up move after 1st march's move down and vise versa. I think its a case of price moving away from it's perceived fundamental value and than coming back to it.

Thats just what i think and i could be way-off.
.
  • #513
  • Mar 2, 2011 6:54am Mar 2, 2011 6:54am
Quoting nasir.khan
Ummm i dont think so. U cant get to know of these deals until u dont have a guy inside the institution. So forget about the down move on 1st march and up move on 1st june..
Agreed - you don't trade it unless you've got info that it's happening. But it does show cause and effect, so adds/detracts to your confidence in a trade depending on effect in the market.
  • #514
  • Edited 8:29am Mar 2, 2011 8:18am | Edited 8:29am
Hey Guys,

I must have too much time on my hands. Can't get this Order Flow mindset out of my head. Sad but true I think I was even dreaming about it last night!

On my Dukascopy I do have market depth and yes before anyone gives a negative response I do know its not the best. The Liquidity providers listed in June 2009 were the following:

Dresdner, SG Paris, Standard Chartered, Barclays Capital, Bank of America, CRNX, JPMorgan, Morgan Stanley, Deutsche Bank AG, RBS, CITI, UBS, HOTSPOT INST, HOTSPOT RETAIL, GOLDMAN, LavaFX, SWFX FX Participant, SWFX FX Anonymous Bank, other liquidity providers.


I don't know how much they may have changed since then but what I have done is just randomly recorded a few hours of the swissy during London/Us sessions. What I 'll try and do now is to see if there is any patterns to it that may be used as a strategy. By slowing it down you can clearly see the price changes being caused by order imbalance between the Bid/Ask. I know a few of the sceptics out there will say but you can't slow the market down but I have seen a video of a guy trading the tape in a very high speed market so maybe it its a possibility.

If I have the time and you guys would like to see it perhaps I can post it through a download site somewhere.Give me some feedback and maybe we can come up with a plan.

Good luck.

James.
  • #515
  • Mar 2, 2011 1:40pm Mar 2, 2011 1:40pm
Quoting redbaron1981
Hey Guys,

I must have too much time on my hands. Can't get this Order Flow mindset out of my head. Sad but true I think I was even dreaming about it last night!

On my Dukascopy I do have market depth and yes before anyone gives a negative response I do know its not the best. The Liquidity providers listed in June 2009 were the following:

[size=2]Dresdner, SG Paris, Standard Chartered, Barclays Capital, Bank of America, CRNX, JPMorgan, Morgan Stanley, Deutsche Bank AG, RBS, CITI, UBS, HOTSPOT INST, HOTSPOT RETAIL, GOLDMAN, LavaFX,...
How far does the Dukas books show? Could you post a screenshot?
I remember when I had a Currenex account with ADM the book was filled with 1/10 pip quotes so you could only see 2-3 pips deep at best.
  • #516
  • Edited 2:52pm Mar 2, 2011 2:35pm | Edited 2:52pm
came across a bit of order flow edutainment for ya on how warren buffet bought silver
http://www.zerohedge.com/article/dee...pulation-redux

although contrary to zerohedge's opinion i think it's just about time to start shorting it now for at least potential down bounces from 35 and 37.
  • #517
  • Mar 2, 2011 2:40pm Mar 2, 2011 2:40pm
Green,

You can see the 10 best bid and offers.

I've been playing around with camtasia so I may be able to upload a short clip soon so you can see.

Theres a few Order Flow traders on here whom I've heard say that they use futures data. Heres a link to the cme website. You do have to register with them to see the D o M but its free!

Heres the link:

http://datasuite.cmegroup.com/EFXweb/index.html

Hope it helps and stay posted for the youtube link.
  • #518
  • Mar 2, 2011 3:36pm Mar 2, 2011 3:36pm
Quoting redbaron1981
Green,

You can see the 10 best bid and offers.

I've been playing around with camtasia so I may be able to upload a short clip soon so you can see.

Theres a few Order Flow traders on here whom I've heard say that they use futures data. Heres a link to the cme website. You do have to register with them to see the D o M but its free!

Heres the link:

http://datasuite.cmegroup.com/EFXweb/index.html

Hope it helps and stay posted for the youtube link.
Thanks man. 10 best bids/offers is too little, only good for scalping. I remember darkstar was talking about 20 or 25 pips each way.
  • #519
  • Mar 2, 2011 3:43pm Mar 2, 2011 3:43pm
Quoting Tilt
But how would you know,when the orders of this particular deal would come through.I mean the timing of this? Isn't it to late by the time this sort of thing hits the public?
I think the logical answer to this question lies in the stop hunts to push these orders through. If you can identify them then you know where these orders are coming in at.
  • #520
  • Mar 2, 2011 3:48pm Mar 2, 2011 3:48pm
Quoting seagreen
Thanks man. 10 best bids/offers is too little, only good for scalping. I remember darkstar was talking about 20 or 25 pips each way.
Depends on the broker, with a tier 2 prime broker that is actually giving you interbank pricing from the 12/13 bank hub, you can configure it to see more, you can also use 4th decimal pricing on currenex, especially if you need more volume... as I understand. Again I am not talking about the MM model viking CNX that you're getting with FXDD for example... I mean fxtrades CNX.

Is it really needed though?
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