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Auction Market Theory and Market Profile

  • #1,581
  • Apr 5, 2011 10:24am Apr 5, 2011 10:24am
According to basic MP setups, daily mp followers should be making decisions @ these levels...................
Attached Image (click to enlarge)
Click to Enlarge Name: daily.jpg Size: 132 KB
Markets are not efficient, rather they are effective - Jones
  • #1,582
  • Edited 10:38am Apr 5, 2011 10:26am | Edited 10:38am
Quoting tgwhbb
15M looks like order matching and absorption of sellers. Moved SL to just under that pin bar ~4199
closed at no longer naked POC 4222
Change is the only constant
  • #1,583
  • Apr 5, 2011 10:28am Apr 5, 2011 10:28am
Quoting tgwhbb
15M looks like order matching and absorption of sellers. Moved SL to just under that pin bar ~4199


KG
  • #1,584
  • Apr 5, 2011 10:30am Apr 5, 2011 10:30am
Just took 2 small shorts for a quick scalp, IMO I think the up move has exhasted itself for this session. I could be wrong. But let see how this goes.
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Markets are not efficient, rather they are effective - Jones
  • #1,585
  • Apr 5, 2011 10:35am Apr 5, 2011 10:35am
Quoting tgwhbb
closed at no longer naked POC 4122

Markets are not efficient, rather they are effective - Jones
  • #1,586
  • Apr 5, 2011 10:37am Apr 5, 2011 10:37am
Quoting mzvega
Just took 2 small shorts for a quick scalp, IMO I think the up move has exhasted itself for this session. I could be wrong. But let see how this goes.
good place for a small short IMO, selling tail in today's profile at yesterday's POC. you are stronger than I...still can not convince myself to short this pair...
Change is the only constant
  • #1,587
  • Apr 5, 2011 10:48am Apr 5, 2011 10:48am
Quoting mzvega
According to basic MP setups, daily mp followers should be making decisions @ these levels...................
may i ask, what is DBY?
thanks for sharing!

Quoting mzvega
Just took 2 small shorts for a quick scalp, IMO I think the up move has exhasted itself for this session. I could be wrong. But let see how this goes.
may i ask, 'exhausted' based on what?
+/-1.4250 is still possible today , IMHO.

depending on your target & stop... be careful & alert.
  • #1,588
  • Apr 5, 2011 10:49am Apr 5, 2011 10:49am
Quoting tgwhbb
good place for a small short IMO, selling tail in today's profile at yesterday's POC. you are stronger than I...still can not convince myself to short this pair...
I try reassure myself of my decisions. I felt the need to get out. If I was confident enough to get out, with my analysis, I should be atleast confident enough in my decision that price wont continue and worst case scenario consolidate. Not much of a risk if I trust my analysis. And then there times I am flat out WRONG.
Markets are not efficient, rather they are effective - Jones
  • #1,589
  • Apr 5, 2011 11:00am Apr 5, 2011 11:00am
Quoting tgwhbb
15M looks like order matching and absorption of sellers. Moved SL to just under that pin bar ~4199
guess i should have stayed in... oh well...still got 60 pips today
Change is the only constant
  • #1,590
  • Edited 11:03am Apr 5, 2011 11:00am | Edited 11:03am
Quoting supremeChaos
may i ask, what is DBY?
thanks for sharing!


may i ask, 'exhausted' based on what?
+/-1.4250 is still possible today , IMHO.

depending on your target & stop... be careful & alert.
DBY "Day before Yesterday". Exhasted, as far as commercial interest. Commercials traders have limit as to how much they can buy or sell (drive). Any upside, imo wouldnt not be caused by commercial buying or. Maybe retail buyers but I doubt with enough volume to hold prices up there without commercial interest. And again this is just my opinion. I also reduce my risk when I do this.
Markets are not efficient, rather they are effective - Jones
  • #1,591
  • Apr 5, 2011 11:27am Apr 5, 2011 11:27am
Quoting mzvega
DBY "Day before Yesterday". Exhasted, as far as commercial interest. Commercials traders have limit as to how much they can buy or sell (drive). Any upside, imo wouldnt not be caused by commercial buying or. Maybe retail buyers but I doubt with enough volume to hold prices up there without commercial interest. And again this is just my opinion. I also reduce my risk when I do this.
What type of sources do you have for commercial deal flow? And what about other participants such as central banks and macro funds? Why only retail?
  • #1,592
  • Apr 5, 2011 11:48am Apr 5, 2011 11:48am
Quoting mzvega
DBY "Day before Yesterday". Exhausted, as far as commercial interest. Commercials traders have limit as to how much they can buy or sell (drive). Any upside, imo wouldnt not be caused by commercial buying or. Maybe retail buyers but I doubt with enough volume to hold prices up there without commercial interest....
thanks!
how about definitions of Open Call & Vol.Diff (volume differential)?

interesting question by Sir medici.
  • #1,593
  • Apr 5, 2011 12:12pm Apr 5, 2011 12:12pm
Quoting medici
What type of sources do you have for commercial deal flow? And what about other participants such as central banks and macro funds? Why only retail?

I have have no sources of deal flow what so ever (i wish)! I just use a weird psychology. I do follow the COT somewhat. Im still learning. But I am pretty confident there is a centain percentge that these people can risk of someone elses money on daily basis. I do understand my anaysis is lacking much, but I am "work in progress" I try to keep these things I read in mind.


The basic concept is to trade with the big money (Commercials) and look to exit when a market loses Commercial support.
The Commercial Traders "way" of being:
• "He is a responsive trader 90% of the time. He is attracted by extreme prices;
• Extreme or long-term price areas are attractive because he has an economic use for the product or stock.
Economic use:
• In commodities he would be the farmer, mining company etc. The producer. . or the short hedgers. Conversely, he would be the grain merchant, wholesaler etc. The distributor of the commodity . . .. or the long hedgers. In stocks he would be the Treasurer of the corporation, the short hedger or the distributor. . Brokerage companies or mutual funds . . ..
• He has inside knowledge about the conditions of the company or product before the market or the media discovers it.
• He is either a producer of the product or stock or he is a distributor of the product or stock.
• If, he is the producer of the stock or product then he is a seller.
• If, he is the distributor of the stock or product then he is a buyer.
• He has a very large capital base, special exchange privileges, special leverage privileges, and extremely deep financing structures.
• He only initiates when forced by overwhelming volume conditions or a large fundamental change in the market.
• A Commercial trades as part of his business model and as such trades to manage inventory or in response to price extremes. When price extremes are out of line with the commodities underlying value or use, the commercial responds by initiating an opening transaction (open interest from the Commercials increases) and he maintains that position until value and price return to balance.


Markets are not efficient, rather they are effective - Jones
  • #1,594
  • Apr 5, 2011 12:28pm Apr 5, 2011 12:28pm
Quoting supremeChaos
thanks!
how about definitions of Open Call & Vol.Diff (volume differential)?

interesting question by Sir medici.
Open call, is covered in "M over M's", I feel its doesnt carry much weight for Forex, unless calculated on a per session bias. (imo). Doesnt work unless using 5 decimal places. Somewhat insightful, but nothing Id write home about. Vol. difference pretty basic.
Markets are not efficient, rather they are effective - Jones
  • #1,595
  • Apr 5, 2011 12:41pm Apr 5, 2011 12:41pm
Quoting medici
What type of sources do you have for commercial deal flow? And what about other participants such as central banks and macro funds? Why only retail?

Totally off topic, but have you read "Practical Trading Applications of Market Profile" by Tom Alexander? I was looking for an opinion?
Markets are not efficient, rather they are effective - Jones
  • #1,596
  • Apr 5, 2011 1:10pm Apr 5, 2011 1:10pm
tempted to go long on EU after that crazy bounce off the developing VAH...
Change is the only constant
  • #1,597
  • Edited 1:23pm Apr 5, 2011 1:17pm | Edited 1:23pm
Quoting tgwhbb
tempted to go long on EU after that crazy bounce off the developing VAH...
Im still stubbornly holding on to my shorts. I should have closed on a test to that vah. didnt realize obama is/was speaking. The only thing that keeps me holding atm is price might be high, but compared to yesterdays profile "value" is still below. Question to self? Where am I in relation to value?
Markets are not efficient, rather they are effective - Jones
  • #1,598
  • Apr 5, 2011 1:28pm Apr 5, 2011 1:28pm
Quoting mzvega
Im still stubbornly holding on to my shorts. I should have closed on a test to that vah. didnt realize obama is/was speaking. The only thing that keeps me holding atm is price might be high, but compared to yesterdays profile "value" is still below. Question to self? Where am I in relation to value?
didn't realize Obama was talking today...in any case, I was looking for a long at the VAH but missed it. looks like initiative buying at 1.42 (VAH), will they absorb the sellers at the top? i took a small long at 4230, let's see what happens, but 15M chart looking bullish to me...
Change is the only constant
  • #1,599
  • Apr 5, 2011 1:39pm Apr 5, 2011 1:39pm
Quoting mzvega

I have have no sources of deal flow what so ever (i wish)! I just use a weird psychology. I do follow the COT somewhat. Im still learning. But I am pretty confident there is a centain percentge that these people can risk of someone elses money on daily basis. I do understand my anaysis is lacking much, but I am "work in progress" I try to keep these things I read in mind.


[left][size=3][size=2]The basic concept is to trade with the big money (Commercials) and look to exit when a market loses Commercial...
Thanks for clarification. I too am "work in progress" and I hope to continue to be.

I take your statements to be based on readings about the commodity futures markets. My experience is that the fx market is a different animal, and that the difference is to the retail participant's advantage.

Maybe you want to read up on specific fx market structure literature? The papers by Carol Osler and books by Rich Lyons and Agustin Silvani recommended.
  • #1,600
  • Apr 5, 2011 1:52pm Apr 5, 2011 1:52pm
Quoting mzvega
Totally off topic, but have you read "Practical Trading Applications of Market Profile" by Tom Alexander? I was looking for an opinion?
Haven't read that one. May have a peak at it if you think it's worth it.
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