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Order Flow - Achieving the mindset

  • #1,761
  • Edited 9:32pm Jun 8, 2011 9:24pm | Edited 9:32pm
Interesting thoughts Monroe. I've noticed the same thing with barrier expiry and increased option defense. The recent AUD/USD option barrier @ 1.0500 is a prime example of this. The barrier was defended fiercely by corporate and bank interest if my memory serves correct. The barrier was being hunted by "leverage sellers" I'd assume hedge funds. After repeated failed attempts IFR reports that implied vols were down due to expiry so protection would not be as fierce. After that no one else was reported on the bid aside from real money. The barrier was just pushed aside. And continued lower until mid east demand stepped in @ 1.0445 and ruined the stop hunt for hedge funds.
Cautiously optimistic. . .
  • #1,762
  • Jun 8, 2011 9:25pm Jun 8, 2011 9:25pm
Quoting Monroe
Yea, so basically used for accumulation or distribution purposes... makes sense..
Those were the words I was looking for lol. It's like an indirect disclosure of another participant's position.
  • #1,763
  • Edited 9:44pm Jun 8, 2011 9:33pm | Edited 9:44pm
Quoting Tact1cal
Interesting thoughts Monroe. I've noticed the same thing with barrier expiry and increased option defense. The recent AUD/USD option barrier @ 1.0500 is a prime example of this. The barrier was defended fiercely by corporate and bank interest if my memory serves correct. The barrier was being hunted by "leverage sellers" I'd assume hedge funds. After repeated failed attempts IFR reports that implied vols were down so protection would not be as fierce. After that no one else was reported on the bid aside from real money buying until mid east demand...

cool, yea 'leveraged sellers' would be hedge funds/large specs... I was not following aud/usd but I am trying to now throw aud/usd and usd/jpy into the mix again.

If short dated Implied vols going down (1M) if I remember correctly, could be assumed that a breakout would be on the cards correct? For instance if 1M-3M implied vols dropping this would mean less vol option players would be long gamma, therefor wider swings expected...(players are short gamma)

I could be wrong with that...

also I think 25 delta risk reversals, if there is an imbalance in buying/selling of calls/puts can be watched to anticipate corrections, especially around news releases...
  • #1,764
  • Jun 8, 2011 9:53pm Jun 8, 2011 9:53pm
Quote
If short dated Implied vols going down (1M) if I remember correctly, could be assumed that a breakout would be on the cards correct?
This is how I played it. Once I saw the hedge funds popping back up on the offer after the barrier was taken out and a couple stabs at the real money buying. I shorted the consolidation above them into the reported stop losses below.

Option volatility and their hedges and stuff still confuse me so I can't really respond with confidence to your other suggestions.

Edit: Here's a picture after the first stab and retreat from protection of the stop losses below. I enjoyed watching it.
Cautiously optimistic. . .
  • #1,765
  • Jun 8, 2011 10:15pm Jun 8, 2011 10:15pm
Quoting Tact1cal
This is how I played it. Once I saw the hedge funds popping back up on the offer after the barrier was taken out and a couple stabs at the real money buying. I shorted the consolidation above them into the reported stop losses below.

Option volatility and their hedges and stuff still confuse me so I can't really respond with confidence to your other suggestions.

Edit: Here's a picture after the first stab and retreat from protection of the stop losses below. I enjoyed watching it.
nice play, props....
  • #1,766
  • Jun 8, 2011 11:16pm Jun 8, 2011 11:16pm
I mean, not that I watch the options stuff all that closely, but if something mentioned is worth noting, i'll keep it in mind...
  • #1,767
  • Jun 9, 2011 1:53am Jun 9, 2011 1:53am
LONDON, June 9 (IFR)- Failures in both directions overnight have left EUR/USD hemmed into a 1.4550/1.4700 comfort-zone. Returning European dealers inherit a spot price in the low-1.46s, with stops seen either side of 1.4550/1.4650. However, it is the barriers on the topside that continue to curb the longer-term Euro appreciation. 1.4696 still marks the 1-Mth highs, with barriers at 1.4700 and 1.4750 due to expire soon.
  • #1,768
  • Jun 9, 2011 2:49am Jun 9, 2011 2:49am
why do i have a feeling we're gonna get a big sell off...
  • #1,769
  • Jun 9, 2011 6:06am Jun 9, 2011 6:06am
Quoting Monroe
Say Trichet does signal further rate hikes, how much further will that take us? I would guess at least enough to fill that gap, possibly to 1.5 and more since the dollar is nowhere close to a rate hike... And a positive Greece plan by the 20th? What if something goes wrong there?
ohhh what go wrong? you fool.
.
  • #1,770
  • Jun 9, 2011 6:09am Jun 9, 2011 6:09am
Quoting Monroe
why do i have a feeling we're gonna get a big sell off...
I'd be looking to buy Eu if that happens, when US data is about to come out.
.
  • #1,771
  • Jun 9, 2011 6:17am Jun 9, 2011 6:17am
Quoting nasir.khan
ohhh what go wrong? you fool.
.
what's that all about kid...
  • #1,772
  • Jun 9, 2011 6:18am Jun 9, 2011 6:18am
I hope Trichet disappoints. Less thinking more selling.
Cautiously optimistic. . .
  • #1,773
  • Jun 9, 2011 6:19am Jun 9, 2011 6:19am
Quoting Monroe
LONDON, June 9 (IFR)- Failures in both directions overnight have left EUR/USD hemmed into a 1.4550/1.4700 comfort-zone. Returning European dealers inherit a spot price in the low-1.46s, with stops seen either side of 1.4550/1.4650. However, it is the barriers on the topside that continue to curb the longer-term Euro appreciation. 1.4696 still marks the 1-Mth highs, with barriers at 1.4700 and 1.4750 due to expire soon.
Hey Monroe and others,

Long time no speak I'm back home for a week now so I have a little time to trade b4 going back offshore.

Monroe can I ask on which news service you got this report from was it Oandas IFR? I've been looking on IFR and FXlive but can't seem to find it.

Best of luck,

James.
  • #1,774
  • Jun 9, 2011 6:19am Jun 9, 2011 6:19am
Quoting Tact1cal
I hope Trichet disappoints. Less thinking more selling.
same here
  • #1,775
  • Jun 9, 2011 6:23am Jun 9, 2011 6:23am
Quoting redbaron1981
Hey Monroe and others,

Long time no speak I'm back home for a week now so I have a little time to trade b4 going back offshore.

Monroe can I ask on which news service you got this report from was it Oandas IFR? I've been looking on IFR and FXlive but can't seem to find it.

Best of luck,

James.
Sup James, long time no see, hope all is well. Yea that was IFR through Oanda.
  • #1,776
  • Jun 9, 2011 6:23am Jun 9, 2011 6:23am
Rumour BIS selling EUR/USD

Reports sell orders clustered 1.4650/60, stops just above there
  • #1,777
  • Jun 9, 2011 6:30am Jun 9, 2011 6:30am
you can see on your chart why that is....

the time is drawing near....
  • #1,778
  • Jun 9, 2011 6:33am Jun 9, 2011 6:33am
Quoting Monroe
what's that all about kid...
Sorry was just kidding, turned out pretty ugly.

Sorry again.
  • #1,779
  • Jun 9, 2011 6:35am Jun 9, 2011 6:35am
Quoting nasir.khan
Sorry was just kidding, turned out pretty ugly.

Sorry again.
lol I thought you were tryin' to pick a fight nasir....
  • #1,780
  • Jun 9, 2011 6:46am Jun 9, 2011 6:46am
Quoting Monroe
lol I thought you were tryin' to pick a fight nasir....
not a bad idea to kick some time, dint do a single trade this week. lol
.
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