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Order Flow Trading

  • #61
  • Apr 26, 2013 9:38am Apr 26, 2013 9:38am
Quoting CindyXXXX
{quote} Commercial darkstar would be spinning in his non commercial grave. Lmao I was expecting an answer like that. Just made a quick 20 ego pips cheers... Haha just kidding... Would you mind elaborating mingary?
If you must you can check my puny and sickly brain child and market cogitations in this journal on FF:
==> In the Pursuit of the Margin Call
  • #62
  • Apr 26, 2013 9:51am Apr 26, 2013 9:51am
Quoting Mingary
{quote} If you must you can check my puny and sickly brain child and market cogitations in this journal on FF: ==> In the Pursuit of the Margin Call
Ok.. But first answer me this honestly... Weren't you the dude running around the forum just recently saying the market was a scam and a suckers game in multiple threads and posts?

What was with that? Hit me
Time hides Nothing
  • #63
  • Apr 26, 2013 10:02am Apr 26, 2013 10:02am
Quoting CindyXXXX
{quote} Ok.. But first answer me this honestly... Weren't you the dude running around the forum just recently saying the market was a scam and a suckers game in multiple threads and posts? What was with that? Hit me
Yes it is I. (evil laugh...)
I only have comtempt and disgust for the schemmie scammers and greedy newbies that make up 99.999 percent of the forex world.
Beyond that I am dead serious when it comes to my trading stuff. And I can't deny that I make a few pips here and there. Also, the presentation and flavor of this journal is a (feeble?) attempt to NOT get any one interested in what I do. It's just a note pad.
  • #64
  • Apr 29, 2013 1:19pm Apr 29, 2013 1:19pm
Another topic for an interesting discussion:

Do you think certain Order Flow concepts are more vulnerable to becoming less profitable if a large number of retail traders would become aware of them?

Let's take stop hunting for example. Obviously, it is much desirable that most of retail traders continue to be unaware of this market event and place their stops at obvious levels + not being aware of the sentiment analysis concept.

What's your view on this? Share it.
  • #65
  • Apr 29, 2013 1:27pm Apr 29, 2013 1:27pm
Quoting CaymanTrader
Another topic for an interesting discussion: Do you think certain Order Flow concepts are more vulnerable to becoming less profitable if a large number of retail traders would become aware of them? Let's take stop hunting for example. Obviously, it is much desirable that most of retail traders continue to be unaware of this market event and place their stops at obvious levels + not being aware of the sentiment analysis concept. What's your view on this? Share it.
Of course... The best (or should I say, most sustainable) order flow techniques revolve around the most plentiful liquidity... Longer term trading generally... The intraday stuff is like coyotes at a bone... Most of it had by HFT's but that's a massive generalization... There's so many dynamics to the term OF trading that I doubt half the people that have posted in the thread here truly understand what it means, but with all that said there is always a way around the downfalls of any negative... You just have to find them. But text book "OF" trading has imho become as common as regular TA trading that it's just bottom feeding. But there is a top to that bottom ya know... Whatever.. It's the game... Just try and stay ahead, if you're losing money then you're losing it to more informed participants.. Get smarter, better, faster stronger..
Time hides Nothing
  • #66
  • Apr 29, 2013 1:30pm Apr 29, 2013 1:30pm
Quoting Mingary
{quote} Yes it is I. (evil laugh...) I only have comtempt and disgust for the schemmie scammers and greedy newbies that make up 99.999 percent of the forex world. Beyond that I am dead serious when it comes to my trading stuff. And I can't deny that I make a few pips here and there. Also, the presentation and flavor of this journal is a (feeble?) attempt to NOT get any one interested in what I do. It's just a note pad.
The question was.. "What was with that"?

Avoidance is a curse
Time hides Nothing
  • #67
  • Apr 29, 2013 1:37pm Apr 29, 2013 1:37pm
Quoting CindyXXXX
{quote} Of course... The best (or should I say, most sustainable) order flow techniques revolve around the most plentiful liquidity... Longer term trading generally... The intraday stuff is like coyotes at a bone... Most of it had by HFT's but that's a massive generalization... There's so many dynamics to the term OF trading that I doubt half the people that have posted in the thread here truly understand what it means, but with all that said there is always a way around the downfalls of any negative... You just have to find them. But text book...
I haven't been that active in the forums, but my perception is that still many retail traders are not really aware what stop hunting truly is about. It is a bit like "coyotes at a bone", but consistency does wonder. One just has to have the patience to wait for the days where sentiment is clear and there is actually a good chance of a stop hunt. I've seen some newbie OF traders that tried to do "stop hunt" trades, but ended up seeing almost every move as a stop hunt.

Yeah, global macro is the playing field of the pro's and I assume that is what you meant in the 2nd part of your post. What's your approach? Not asking for any details, just curious.
  • #68
  • Edited 2:25pm Apr 29, 2013 2:01pm | Edited 2:25pm
Quoting CaymanTrader
{quote} I haven't been that active in the forums, but my perception is that still many retail traders are not really aware what stop hunting truly is about. It is a bit like "coyotes at a bone", but consistency does wonder. One just has to have the patience to wait for the days where sentiment is clear and there is actually a good chance of a stop hunt. I've seen some newbie OF traders that tried to do "stop hunt" trades, but ended up seeing almost every move as a stop hunt. Yeah, global macro is the playing field of the pro's and I assume that...
My approach is at the minute, why the markets are the way they are, purely technical. I honestly do not read, nor care what the news/sentiment is. When things eeeeevvvvennntuuuuaalllly... turn growth again I will likely pay more attention but basically I just trade what I call gaps... Stops to limits and back again.

Some gaps are 20 pips others 200 pips but I'm still an intraday trader in and out. The most I will l hold a trade generally is 3 days max, with more capital I would hold a separate account for longer term trading. I'm just not there yet.. Still blinded by all the lights so to speak And loving it.

I don't know nor care if the way I trade falls into an "order flow" category.. I've just basically taken everything I've learned form various things in the past 5 years and formed a method of operation. It works well and that's all that matters. Call it what you will.

Inserted Video


Oh fk a music vid in the OF thread.. sue me!
Time hides Nothing
  • #69
  • Apr 29, 2013 2:03pm Apr 29, 2013 2:03pm
Quoting CaymanTrader
Another topic for an interesting discussion: Do you think certain Order Flow concepts are more vulnerable to becoming less profitable if a large number of retail traders would become aware of them? Let's take stop hunting for example. Obviously, it is much desirable that most of retail traders continue to be unaware of this market event and place their stops at obvious levels + not being aware of the sentiment analysis concept. What's your view on this? Share it.

Stop hunting is more intricate than just fading highs and lows, that's where most retail traders seem to fail. When you start to understand that 80-90% of market swings are traders losing, on any time-frame, that's when it becomes a different ball-game. "Stop-hunting" is always going on, whether it's to initiate positions or to liquidate positions, and it's not as common at highs and lows.
  • #70
  • Apr 29, 2013 2:04pm Apr 29, 2013 2:04pm
Quoting Benevolent
{quote} Stop hunting is more intricate than just fading highs and lows, that's where most retail traders seem to fail. When you start to understand that 80-90% of market swings are traders losing, on any time-frame, that's when it becomes a different ball-game. "Stop-hunting" is always going on, whether it's to initiate positions or to liquidate positions, and it's not as common at highs and lows.
Yeah.. I think a better term would be shake outs...
Time hides Nothing
  • #71
  • Apr 29, 2013 2:07pm Apr 29, 2013 2:07pm
Quoting CindyXXXX
{quote} Yeah.. I think a better term would be shake outs...
Are you saying 'shake outs' happen 80-90% of the time. Or fading highs / lows are referred to as shakeouts.
  • #72
  • Apr 29, 2013 2:17pm Apr 29, 2013 2:17pm
Quoting Benevolent
{quote} Are you saying 'shake outs' happen 80-90% of the time. Or fading highs / lows are referred to as shakeouts.
I'm saying that no one likes to share their toyz!

But yeah, more along the lines of 80-90% of the time and shakin' ... whatever that means.
Time hides Nothing
  • #73
  • Apr 29, 2013 2:24pm Apr 29, 2013 2:24pm
@ Bene: Well, it's a zero-sum game, the purpose is to earn your profits from the losing side. However, I found targeting specifically the larger cluster of stops at highs/lows a method that works for me. But if you can trade those "shakeouts" constantly between the swings, kudos to you.
  • #74
  • Apr 29, 2013 3:12pm Apr 29, 2013 3:12pm
Quoting CaymanTrader
@ Bene: Well, it's a zero-sum game, the purpose is to earn your profits from the losing side. However, I found targeting specifically the larger cluster of stops at highs/lows a method that works for me. But if you can trade those "shakeouts" constantly between the swings, kudos to you.
I love the way interpretations are set in stone

Inserted Video


Box it out a bit
Time hides Nothing
  • #75
  • Apr 29, 2013 3:15pm Apr 29, 2013 3:15pm
Quoting CindyXXXX
{quote} I love the way interpretations are set in stone http://www.youtube.com/watch?v=XiRqQYaVrNQ Box it out a bit
^this

It's not as impossible as some make it out to be guys. Like I've said before, pick up a DOM and T&S, and learn about the flows of inventory. You get a pretty good idea of how inventory exchanges hands from losing traders and liquidity providers. It's not rocket science, it's just not talked about a lot.
  • #76
  • Apr 29, 2013 3:28pm Apr 29, 2013 3:28pm
Here's an example today in the ES:

http://screencast.com/t/ctcH6VCCqz

White box shows liquidity takers who get trapped, wanting to break the highs. (liquidity on the supply side is too much to consume)
Red box shows those longs liquidating.
Trade the cause, liquidate the effect.
  • #77
  • Apr 29, 2013 3:56pm Apr 29, 2013 3:56pm
Quoting Benevolent
Here's an example today in the ES: http://screencast.com/t/ctcH6VCCqz White box shows liquidity takers who get trapped, wanting to break the highs. (liquidity on the supply side is too much to consume) Red box shows those longs liquidating. Trade the cause, liquidate the effect.
So you determine that they longs got trapped based on watching PA on the DOM? Seeing that there is too much supply and longs are unable to move price higher even on decent volume?
  • #78
  • Apr 29, 2013 4:00pm Apr 29, 2013 4:00pm
Quoting CaymanTrader
{quote} So you determine that they longs got trapped based on watching PA on the DOM? Seeing that there is too much supply and longs are unable to move price higher even on decent volume?

Correct. And that's the mindset you need to have to trade those swings that are 'impossible' to trade
  • #79
  • May 6, 2013 11:52am May 6, 2013 11:52am
Back to the topic of whether too many people being aware of OFT would do damage to the overall method:

I think the answer is NO, because there are far many ways to apply OF methods. Even if a lot of traders would use a certain strategy (i.e. stop hunts), the entry method of each trader would be different. There is no set rule where one should enter, it can be i.e. entering on momentum or waiting to fade a S/R and target stops on the other side.

Also, I think the average retail trader will not really bother with this concept for a long time after they started studying it. While the theory itself is not too complicated to understand, it requires to completely change your mindset as trader and view the market differently as you did as TA trader (which may seem quite complex in the beginning).

Another thing that makes OFT so awesome is that it requires you to think a lot about what is happening in the markets. Every OF trader has something unique in his system, but the core idea is that you think outside the box - i.e. what other participants might do.

Share your opinion!
  • #80
  • May 6, 2013 6:48pm May 6, 2013 6:48pm
OFT's edge will never fully "expire", even if the entire world was trading based off of orders. There's so much orderflow information to process, so many different agendas, so many different motives, that it will forever stay in motion. For instance, take a look at option barriers. Everyone and their mom plays those these days, and they still provide the same edge they did a few years ago when they were unheard of.
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