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  • #2,721
  • Jun 23, 2013 6:33am Jun 23, 2013 6:33am
Quoting dappa
{quote} Thanks for the reply! Appreciate the help! Market orders move price, plain and simple? When you see price move away from a demand zone, its market orders that caused that , not limit orders stacked at that level? Cause standing order only provide liquidity for market orders which will create pressure(market Orders) one way or the other at these levels?
Yes, market orders move price. Its paying for immediacy.
Ex: If the bid/ask on EU is 1.3114/1.3116, you may have buy limit at 1.3114 but say the Fed announced that it's going to be increasing QE, you need to get in that buy trade now (immediacy). You'll execute a market order to meet the ask at 1.3116 and be filled. Now if you consumed sell orders at 1.3116, the bid/ask will be 1.3114/1.3117, last trade being @ 1.3116. If there's decent liquidity, then the bid will move to 1.3115. If not, the spread will stay 3 pips @ 1.3114/1.3117 (spread widening).

As Cindy pointed out, there are stop-limit orders which are placed on the limit side of the market, but turn in to market orders once price reaches them. aka "stops"
  • #2,722
  • Jun 23, 2013 6:39am Jun 23, 2013 6:39am
Quoting LiquidityGAP
{quote} Volume is relatively easy to see in Forex, its simply the size of the candle sticks. The strongest volume will always create the largest candles, unless its a reversal where theres a lot of up and down action and you cant see the true volume. In that case you break it down to the smaller time frame to analyze the volume.
That's volatility, not volume. Some of the largest trades are designed to not move the market. ie; When selling a yard of a security in to a billion $$ worth of buy stops to not move the market.
  • #2,723
  • Jun 23, 2013 8:53am Jun 23, 2013 8:53am
Quoting EmeraldEyes
{quote} That's volatility, not volume. Some of the largest trades are designed to not move the market. ie; When selling a yard of a security in to a billion $$ worth of buy stops to not move the market.

What do you mean by your statement above?
  • #2,724
  • Jun 24, 2013 6:35am Jun 24, 2013 6:35am
Hey there, decided to record short video of break out price acttion in today's 10 year notes overnight session.

I see a lot of people here does not have a clue of what order flow and tape reading is all about, but i gues that is the product of people starting learning the busines from the rear end... and all of that TA bushit which keeps people lazy and gives some kind of false beliave that one cuold predict future by looking at past data .....

Anyway the point here is to whatch how people are getting traped shorting from the level and leaning on it to hold as a resistance, together with smarter buyers pushing theyr bids higher and higher, see u have both new longs ready to smash the level and weak short posittions knowing they are worked...

One should know and understand these kind of things on order to be successful in day trading, unless you use some kind of mechanical system based on TA with MCdees an averages

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  • #2,725
  • Jun 24, 2013 9:37am Jun 24, 2013 9:37am
I see, so are you just looking for the offers to get eaten up to get on board for a long? or the bids to get eat up for a short, how do you read that data?
  • #2,726
  • Jun 24, 2013 9:56am Jun 24, 2013 9:56am
I either work a limit order in front of the held bid, or try get and edge as the offer are leaving...It's better to work a posittion before breakout happens, if i see preasure building up in case of a fallse break out...
  • #2,727
  • Jun 24, 2013 9:57am Jun 24, 2013 9:57am
Quoting dappa
{quote} What do you mean by your statement above?
When trading large orders that will move price, its best not to move the market much so you can still get good pricing. A cluster of opposing orders can do that.
  • #2,728
  • Jun 24, 2013 10:59am Jun 24, 2013 10:59am
No one knows how much market orders are coming into the market, you just know pending orders, well for futures that is?

That DOM platform only shows pending orders, not market orders?
  • #2,729
  • Jun 24, 2013 11:09am Jun 24, 2013 11:09am
Quoting EmeraldEyes
{quote} That's volatility, not volume. Some of the largest trades are designed to not move the market. ie; When selling a yard of a security in to a billion $$ worth of buy stops to not move the market.

Isn't volitility the synonym for liquidity gap? less liquid more volatility ,correct, price moves(the quote) moves fast to the next price level of liquidity?

So how do you indetify volume on a chart then, cause a spike up and a close of a big bar to me would mean high demand,meaning not enough orders to stop the quote from moving hard and fast. volume could only be in the context of market pressure (orders coming in)?

Correct me if I'm wrong someone.
  • #2,730
  • Jun 24, 2013 11:37am Jun 24, 2013 11:37am
Quoting PutaMadre
I either work a limit order in front of the held bid, or try get and edge as the offer are leaving...It's better to work a posittion before breakout happens, if i see preasure building up in case of a fallse break out...

So you try and front run the bids because market orders are consuming more offers than bids?
  • #2,731
  • Jun 24, 2013 3:09pm Jun 24, 2013 3:09pm
Quoting dappa
{quote} Isn't volitility the synonym for liquidity gap? less liquid more volatility ,correct, price moves(the quote) moves fast to the next price level of liquidity? So how do you indetify volume on a chart then, cause a spike up and a close of a big bar to me would mean high demand,meaning not enough orders to stop the quote from moving hard and fast. volume could only be in the context of market pressure (orders coming in)? Correct me if I'm wrong someone.
Volatility is one of the results of low liquidity as when important economic data is about to be released, but I don't think all volatility is a result of an illiquid market.

Finding Forex volume based on a price chart isn't possible in this market as there are exchanges located all over the world. I know there are methods/indicators which volume is produced but it's inaccurate. A futures market is a centralized exchange so stuff like Volume and Depth Of Market are openly provided and accurate.
  • #2,732
  • Jun 24, 2013 3:29pm Jun 24, 2013 3:29pm
Quoting EmeraldEyes
{quote} Volatility is one of the results of low liquidity as when important economic data is about to be released, but I don't think all volatility is a result of an illiquid market. Finding Forex volume based on a price chart isn't possible in this market as there are exchanges located all over the world. I know there are methods/indicators which volume is produced but it's inaccurate. A futures market is a centralized exchange so stuff like Volume and Depth Of Market are openly provided and accurate.

But Volume is what? Selling or buying pressure? If thats what moves the market, then volume must be market orders?

I mean volume would be the amount of participants that want to buy and sell, it wouldn't be weighed in the context of standing orders, cause standing orders don't move price? so lets say I was looking at any other market, volume would still be the same thing only really and truly quantified, it would be still be the same thing wouldn't it, volume=a willingness to buy or sell which would consume limit orders?

Only difference, is other markets there is actual inventory?

Someone correct me if I am wrong, just trying to learn from you Pro's
  • #2,733
  • Jun 24, 2013 3:51pm Jun 24, 2013 3:51pm
'Volume' is just the historic amount traded at that time/price level. The amount of participants that want to buy and sell (and haven't yet) are known as latent demand. Latent demand changes depending on what happens with price levels, and news, obviously. They are unknown as if they're going to provide or consume liquidity (limits or market orders) The DOM in PutaMadre's vid above shows latent demand. That info isn't available in Forex though.
  • #2,734
  • Jun 25, 2013 4:12am Jun 25, 2013 4:12am
Quoting dappa
No one knows how much market orders are coming into the market, you just know pending orders, well for futures that is? That DOM platform only shows pending orders, not market orders?
Correct. DOM does not show market orders but does show stop loss orders (stops) which turn in to market orders when at the bid/ask.

Btw, here's an example of the Euro futures market moving 20 pips down on 6k of volume, then 20 pips up with only 3k. http://i44.tinypic.com/r2kjyt.jpg
  • #2,735
  • Jun 25, 2013 4:37am Jun 25, 2013 4:37am
Quoting EmeraldEyes
{quote} Correct. DOM does not show market orders but does show stop loss orders (stops) which turn in to market orders when at the bid/ask. Btw, here's an example of the Euro futures market moving 20 pips down on 6k of volume, then 20 pips up with only 3k. {image}
Modern DOM's as Xtrader, CQG, Or CTS shows market order prints which are hitting into bids and offers, you can allso see volume profiles of acumulated amount printed into a level. The other whay to see prints is to use time&sales a.k.a the tape, but due to new exchange regulattions is quite usseles, because of algos that can split 100 lot order into 1 lot mashine gun fire ant totaly flud the tape....

The stock market is a bit diferent because they trade shares in blocks (at least i think so...)

Allso there a lot of others whays to see prints, the most popular these days is footprint charts http://www.marketdelta.com/
  • #2,736
  • Jun 25, 2013 8:16am Jun 25, 2013 8:16am
Quoting PutaMadre
{quote} Modern DOM's as Xtrader, CQG, Or CTS shows market order prints which are hitting into bids and offers, you can allso see volume profiles of acumulated amount printed into a level. The other whay to see prints is to use time&sales a.k.a the tape, but due to new exchange regulattions is quite usseles, because of algos that can split 100 lot order into 1 lot mashine gun fire ant totaly flud the tape.... The stock market is a bit diferent because they trade shares in blocks (at least i think so...) Allso there a lot of others whays to see prints,...

But all of that applies to futures trading ,correct?
  • #2,737
  • Edited 8:29am Jun 25, 2013 8:17am | Edited 8:29am
It seems as though, there is no way to trade forex(spot) successfully unless you have a DOM.

When they say basing in forex, price rally based and then droped, what is the meaning of the term basing?

To me it means price ranged, but is that all it really means?
  • #2,738
  • Jun 25, 2013 10:41am Jun 25, 2013 10:41am
Quoting dappa
It seems as though, there is no way to trade forex(spot) successfully unless you have a DOM. When they say basing in forex, price rally based and then droped, what is the meaning of the term basing? To me it means price ranged, but is that all it really means?
It depends on what time frame you trading in. Tape reading and orderflow is usefull for scalping in active intraday trading, if you trade higher time frames or using some mechanical system than i guess it makes no sense to use it....
  • #2,739
  • Jun 25, 2013 10:46am Jun 25, 2013 10:46am
Quoting dappa
It seems as though, there is no way to trade forex(spot) successfully unless you have a DOM. When they say basing in forex, price rally based and then droped, what is the meaning of the term basing? To me it means price ranged, but is that all it really means?
That's not a healthy mindset to have...straight off the bat, if you assume you need "x" to trade, you're limiting your beliefs. Especially if the "x" is based on shaky principles in which case you're set to fail before you even start.


To keep this order-flow related, a general article about OF trading - http://orderflowforex.com/order-flow...-flow-trading/ and http://orderflowforex.com/trader-dev...-trader-cycle/


Order flow is a general term for a type of trading, so it doesn't necessarily mean it's only useful for intraday trading. If you're looking at how other people trade, timeframes stop becoming relevant.
  • #2,740
  • Jun 25, 2013 2:50pm Jun 25, 2013 2:50pm
Quoting lolpie
{quote} That's not a healthy mindset to have...straight off the bat, if you assume you need "x" to trade, you're limiting your beliefs. Especially if the "x" is based on shaky principles in which case you're set to fail before you even start. To keep this order-flow related, a general article about OF trading - http://orderflowforex.com/order-flow...-flow-trading/ and http://orderflowforex.com/trader-dev...-trader-cycle/ Order flow is a general term for a type of trading, so it...

Well it's not that I have a negative mindset, it's just everyone has a different consensus as to what is order flow and how to look at it.

Some say look at futures, DOM.

Some say look at forex live for the order updates. But i still don't know how to put it together.

I see orders on forex live, so i mark off the zone on my charts, cool, all that means to me is that there are standing bids and offers, I still don't understand how to capitalize on that by looking at price action, I cant visually conceptualize how to trade from a chart cause I don't know what to look for to enter a trade even knowing where the posted bids and offers are.

My thinking is to buy where the bids are or sell where the offers are but I am still trying to figure out how to approach that.

The bids and the offers are right on top and below each other, so orders build up around the market price, what ever and where ever it might be?
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