Trading Institutional Order Flow

Hello MM & Lade.
Thank you for the discourse.
If I may, a few notes for you to consider

best wishes

Hello everyone.
TGIF.

I would like to discuss briefly something I have seen fellow traders do that may cause them some confusion about the methodology. That is, focusing on the basing or type of basing to determine whether a zone is supply or demand.
That is incorrect.

Let us ask the question, "what makes a zone a zone?"

Is it the basing, the time spent at the level, or is a zone recognizable only as a zone AFTER the resolution of the supply-demand equation at that level becomes obvious by the move away from that basing.

Let us think about it.
When price is basing, basing, in an area, do we draw our lines around it and call it a zone?
Of course not.
We only call it a zone when we see price depart from the basing area. The quality of the zone is then and only then, assess-able using the strength of that move away, the location of the zone in relation to the big picture zones, number of periods spent in basing at the level etc.

Actually, the time spent at the basing level is one of the least important markers because if I want to reduce the periods all i do is change the time frame to a higher one and I will reduce the number of candles in the base.

So when we see traders saying for example, that a particular basing area is not a zone because it has one candle or 8 candles for example, it is not totally accurate and ignores what the key elements of defining a zone are.

I hope this helps

best wishes

Good day all.
Thank you for comment on my last post
Kindly do same on the below attached.

Hi there!
This is my last profit, EURCAD on H4.

My curve, W chart, is low, so i'm seek long position


On the D chart, a new DZ was created and we have space for long trades


On H4, price react at a DZ and move up well. I had a SZ not fresh between my level and the first D level (my target). My idea was try to arrive to the D level.
When the price arrive in to the SZ, order unfilled were triggered again and price move down. I had move up my SL and the price hit it, with profit, but not as much as I hoped.


Comments are welcome, friends!
Cheers!

Mauro

Hello MadMojosss
Thank you for sharing this trade.
Goes to show we retail traders can make trading work for us if we are willing to learn and apply.
Anyone can do this with the right help and support
Well done to you sir!

best wishes

Kind of old now, but took this AUD/CAD trade. 15 minute fresh supply zone made prices drop.

Hello everyone.

Trade review USD/JPY
Trade idea - NZD/CAD

My thoughts

best wishes

Nice one Sunny.
Great trade.

best wishes

Something I see coming up on AUD/USD. 4 hour supply zone.

Hello SunnyChopper.
Thank you for sharing your thoughts on the AUDUSD. You beat me to it.

Here are my thoughts on it

best wishes

I am with you, 60min chart!

Hello Madmojoss.

Correct. New SZs are being formed inside the daily.

best wishes

Dear friend USOIL.​
Last profit on H4



Cheers,
Mauro

Hi there!
This is the first loss of the weekly and I want share it with all you! We can't win always

The pair is AUD USD: my idea was short on H1 for a quick profit because on the W we are in consolidation but close to a not fresh SZ (yellow square).
To strenghthen my idea we was close to a D and H4 supply zone. For me, the short, was the correct way for a fast profit.

My stop was not taken, I close the position when I saw the price was over my distal line on 4H time frame.

Below you have the chart, comments are welcome!

Cheers,
Mauro

Hello Mauro

Thank you for sharing this.
Goes to show, every methodology will have losing trades
Every trader has them.
It is what we do with the losers that makes the difference

best wishes

Hello everyone

USD/CHF......from a day trading perspective

best wishes

Hello everyone

NZDCAD...day trades beginning..from the short side.
Unlikely to be easy

best wishes

Hello everyone.

USD/JPY today.

Best wishes

Hello everyone.

Today, I would like to talk about a critical topic to do with trading - The Reward to Risk Ratio.

You often hear the phrase, "you can't go broke taking a profit" being stated as the reason why it is advisable to take small R;R ratios or cutting winners too quickly. This is simply an incorrect assertion to make.

There is a missing component. The win rate the trader has, using whatever methodology he or she decides to use. Please notice that i did not say the win rate of the methodology, I am not sure that can be calculated in a way that would be useful to us as traders. What is important though, is the win rate the trader either has experienced in live trading for himself or herself, or experienced in simulated trading.
2 traders can apply the same methodology and get very very different results.

What is the same? - the methodology
What is different? - the trader applying the methodology.

Anyways, I digress. Back to the lesson at hand.

Let us take 2 traders over 100 trades. Same methodology, different win rates and different R:R ratios.

Trader A has a win rate of 80%. He takes a 1:1 Reward to risk ratio for his trades. Over 100 trades, he gets 80R, loses 20r - Net 60 R:R

Trader B has a win rate of 40%. He takes a 3:1 Reward to risk ratio for his trades. Over 100 trades, he gets (40 X 3) = 120R, loses (60 X 1) = 60r - Net 60 R:R

Now let us ask the question, what is the more realistic, possible result a trader can aim for trading the financial markets?

The general accepted industry statistic is that the best traders in the world, with the best tools, the best research, the best access, score anything from 40 - 60% consistently, if one removes the outlier trades.

Let us go back and apply a smaller win rate to Trader A.

Lets say he wins 60% of his trades, he is one of the best out there. His Reward is 60R and his Risk is 40R. He nets 20 Reward: risk.

Trader B with a 60% win rate, gets 180 (60 X 3) Reward and his risk is 120 (40x 3). He nets 180 - 120 = 60 Reward: risk.

That is the math of trading.

What we seek is consistency in results, in approach and in outcomes. We can not simply believe we will get 80, 90% of our trades correct and will retire in a year. If only it were that easy.

Reward to risk ratios MUST be a part of our risk management calculations when we are looking at our assets under management, our hard earned money.

2% risk to make 6% (3:1) requires just a 33% win rate to begin be profitable

2% risk to make 2% (1:1) requires a 60% win rate to begin to be profitable

Which one do you think is CONSISTENTLY achievable?

Your trading, your decision.

Best wishes

thank u @Akt for your support and time you've sacrificed 4 us! God bless u brother


This week alone, I've missed about 200pips just because I exited the trade too early, in USDCAD, AUDUSD and USDJPY.
I seriously need this RR, I need to be addicted to it in such that I won't be chickened out of profitable trades, all because I want to secure little profit