Regardless of what does happen, you know the zones to watch the price action.
The first chart uses the correction zone and 100 sma… remain below it and the bears keep the momentum. Move and hold above the correction zone and 100 sma, and the bulls are fully back in control as price will be above the 100 sma but also the 200sma.
The second chart points to the possibility of the bears taking complete control with price moving below the 200sma, but more importantly keeping it below.
The other scenario on chart 2 is the bears will use the momentum to try and take price below the 200 sma, but the bulls will put up a fair fight to stop any down trend for fully forming.
As I said… you know which parts of the charts to watch and what to watch for in terms of price action at the MAs or correction zone.
The other scenario which I haven’t market off, is the over night trade does NOTHING and we just see sideways action…
I only trade London so I will reassess in morning.
ps: The charts above only represent the technical analysis aspects and do not include any flow/barriers or fundamental analysis)
This is an accurate description of how flow it works to a point yes.
But this does not mean that their software does what they say. You would have to spend a lot of time comparing their data with correct data via Bloomberg or at the least IFR (Reuters)
can you give David a break and stay with the program as respect to him. if you read page one of thi thread it explains what we are here for…we will drive David away with of track subjects, one thing at a time please, unless you do not reconise how valuable davids program is…honestly its amazing…learn this save all this of subject for another thread please
Just been reported on Bloomberg T that there is a lot of interest in a ‘put option’ been taken on EUR/CHF @ 1.1700.
If its taken out, then this would place the SNB peg @ 1.2000 in danger.
Just thought any holders of the E/C out there may want to know. Nothing confirmed yet…
USD/JPY: Early reports say there is LARGE bids down @ 78.00 from BOJ.
quote from your post…
“That’s significant two in aspects”??
Sorry, call me pedantic but when vendors make such basic grammatical errors alarm bells ring. The sentence following it does not make sense either & they are supposed to be selling market info - data they have to assimilate & communicate with zero ambiguity or confusion yet their front end shop window fails to do just that. How ironic.
I don’t really understand order flow so I assume that means that we should hit that level and bounce up (referring to U/J) Anybody can answer this for me, I don’t want to wear David out. Lol
Thanks David, just as I was looking for tomorrow, am seeing the charts in the same way now, all thanks to your teaching.
I really must make this point, first learn as David teaches to read price with regard to the 100 and 200sma’s and only once you understand and can trade using this technique then look to add the zones. Thanks to David’s help I can now understand where and what I need to look for on all trades I am taking.
traderjosh - assume you are talking about usd/jpy then yes and no. it doesnt necessarily mean it will ‘bounce up’ as you cannot predict the vol which wants to sell at this level, but you should at least see some price consolidation (sideways chart movement), and obviously be aware that selling into or around this level is perhaps not a great move.
as david has mentioned before, there are a lot of traders trading order flow ie buying / selling where big money is doing the same, and using these areas for entry.
edit:it would be interesting to look at price action on lower t/f’s at this level to see if there is any evidence of a turn around in price.
i wonder how much they have spent on this already, there was an article suggesting that they had in fact sold loads of euros a bit higher. i tried to pick apart their balance sheet which is public info but it seems to miss out just enough info to be able to determine exactly what they are doing…then again thats prob just my crap accounting skills at play.
there’s gonna be some big stops just below the peg! and perhaps one spike before this happens to shake out some of the numerous shorts building up here?
If you have access to a tick chart, the take an 89 tick chart when price reaches order flow zones or barriers. Order flow traders look to take 5-20 pips moves at the bids/offers/barriers and protective barriers bids/offers ect ect.
If you don’t have a tick chart then monitor a 1 minute chart. Look for slow downs and reversals. Order flow is the purest form of scalping. But not the only way of using it.
For the scalping purpose, then around that or just slightly better. Its very short term trading.
A friend I play golf with over in the states (try to play golf) is a prop trader, he trades the EUR/USD and S&P flow only. I think hes did around $3 million per year past 2-3 years trading flow on those two. I don’t know his exact technique, but price action and order flow drive it is, and hes taking 5-20 ticks/pips at a time 2-3 times per day.
ps: Obviously hes trading a large account, so I don’t want people thinking their going to make 3 mill a year!
2nd ps : I should also point out that he is selective of his flow data and levels… not everything reported is traded. I think he focuses more on the protective bids/offers at or near option barriers. And the option barrier has to met a certain criteria also… 500 million upwards and be a particular option ect ect ect.
sure, just like you will not take every bounce from a correction zone - cos maybe the PA wasnt clear or it bounced before the zone. interesting to know people are doing that, i would imagine he has a very valuable contacts list.
imagine gold/silver markets will be interesting over next few weeks, PA for these is looking very tight and ripe for a big move. Aug NFP might be the trigger.
on that subject do you know many people who trade figures now? i used to work at a prop firm about 8 years ago and it was possible then to hover over the mouse with eyes peeled on bloomberg (with bog standard hardware…desktop pc’s / network infrastructure) and hit the bid/lift the offer when say NFP was way out and make decent dough. nowadays its a nogo zone for them.
and the next bid is close to the correction zone you intimated. which in theory is still a correction zone now as you said this technique should work for any time zone.
I will clear this up, when I say there is bids and give a level or levels, it doesn’t mean that the bids are all on that one level… that’s just the main level, there is bids on each side of it. Normally a 5 pip zone both sides.
So if I say there is bids @ 1.0350… then there will be bids around that whole level… 1.0355’s… 1.0345’s. Price will bob up and down as it eats through these in search of more supply/demand.
: I should also point out that he is selective of his flow data and levels… not everything reported is traded. I think he focuses more on the protective bids/offers at or near option barriers. And the option barrier has to met a certain criteria also… 500 million upwards and be a particular option ect ect ect.