Basically, if we divide the live EUR/USD DOM from MB Trading’s ECN (using their API) into an Ask region 2 PIPS wide = 20 tenths of a PIP wide (“tiers” 1…20, 5-digit pricing), and the same for the Bid region of the DOM… then we define the INNER DOM, which is tiers 1…5 (inner 0.5, half pip), and the OUTER DOM which is tiers 6…20 (1.5 pips region), we can analyze/sample the size which is being quoted, several times per second. At the Extreme Inner tiers of the DOM, large quoted volume tends to “push” price away from it. The Outer region (on either side) tends to “pull” or attract price (as a prediction). Basically, large players (I simply call them Market Makers) hang slightly away from the inside market, and then remove their Inner tier quotes (the “pull” component of the analysis). This causes the market to “jump”, and their outer quoted size is right there, just waiting waiting to be hit. It’s all custom interfacing and charting, nothing standard about it at all, so would be hard to replicate, but that’s the overall algorithm concept.
So, in a nutshell, a White circle represents Bid-side Inner tier “push” information AND that is combined with Ask-side Outer tier “pull” information. The circle is interpreted as “pushing” price away from it, but it is a “composite” which consists both of a “push” component, and an opposite side “pull” component. Ask side analysis same, but opposite, obviously. We also apply a threshold size, so that smaller size events are suppressed, and all we see are the larger size components, assumed to represent MM activity.
Anyway, the central thesis is that Market Maker plans price moves in advance, and placement of size on the tiers of a Live DOM can be used to “get inside their heads” just enough to get an edge. The problem is that you may have to process hundreds of events per second, so things get a little crazy in the algo code. This is also very close scalping so you need to have a tight spread and very low commission cost, etc.
errrr…yeah…hell yes…
dont know how you managed to work all that out…
if anyone deserves the brainbox of the centrury award…i nominate you.
you lost me @ "basically…"
whatever it is you were on about …i like the sound of it…but im gonna need a degree in bionics to even start to comprehend how you actually wrote the algs for that thing.
Hey, thanks, I think… but let’s not forget there are many timeframes to trade on, and I’ve just chosen short timeframes. I’ve devoted many years of my life to this, and it shows just how difficult it can be to get “an edge” over a market. Humility is one of the things you learn as a trader, because either you can find an “edge” or you’re deluding yourself, and wasting your life The problem in trading is that so many Links in the Chain have to be fully forged; otherwise, no matter how smart you may think you are, you will be Defeated That’s what makes trading so interesting; if it were Easy, everyone would be doing it, Profitably… And it’s a little bit like Card Counting, yet they can’t throw you out of the Casino (references to gambling intended… as trading contains an element of gambling in it…) HyperScalper.
yes i totally agree…, and even though i am having a bit of a laugh…it is meant as a compliment.
that stuff your onto is way over my head…but hopefully sooner or later i will be able to make some sense of it.
keep up the good work…
as apart from learning great trading techniques from ICT …i am a believer that you need a solid system with an edge…and if you dont have one that you can rely on then you are doomed…and if you use disgretionary trading you either get lucky or you are doomed also…
im looking for a great system that i can depend on.
THE most important thing to understand about becoming a Trader is that you must find a NICHE, and SPECIALIZE within that niche area. I don’t think anybody would really disagree with that statement. Find your NICHE and put all of your energies into understanding it. H.
not sure i agree with that…i was reading about the turtle traders and what those guys said made a lot of sense…
they worked multiple markets at the same time and were trend followers…the more markets they worked the more chance they had of their system catching a trend…plus their markets were diversivied .and didnt corrolate too much…so when something went wrong in a commodity …they could soak up the damage…
unless by niche you mean …trend follower (in whatever markets you choose)
or scalper etc.
they were lucky in that they had a system that was proven to work.
that is what i am looking for.
a system proven to work …that suits my personality.
Its also necessary that trader should understand the initial knowledge of Forex trading and keep proper practice in demo account trading so that practical experience will also help the trader to trade more efficiently in future.
That’s what makes trading so interesting; if it were Easy, everyone would be doing it, Profitably… And it’s a little bit like Card Counting, yet they can’t throw you out of the Casino (references to gambling intended… as trading contains an element of gambling in it…) 
HyperScalper.