Whats up man. It’s not a silly question lol. I don’t run TP’s, I take the Entire day open to close pips. As far as last nights trades go, i feel like I got a premature signal and I have some new money figures i am running that I deem important. i thought about them today and was just able to look into them. So far It looks like I could have gotten a buy for all three pairs today, however I need to test more days which is what i am doing now. Conceptually It makes sense.
My theory is that at any given price, as buyers are selling and sellers are buying, the majority of these orders whether they be limit or market cancel each other out because a buyer agrees to sell at a particular price, and a seller agrees to buy at that particular price. This result causes the market not to move and stay at at the same price if there are exactly the same amount of buyers in volume as sellers in volume (Volume = money). However, because the market is not perfect, and the majority of the time one side is larger in volume than the other (more buyers than sellers or visa versa) an excess amount of money is left over at the particular price the market is at in that moment. As an example, at a particular price, excess money is left over in the form of a buy, meaning x amount of buyers orders in dollar form where not filled at that given price, however all sellers orders have been filled at the same given price. With this is mind, the market moves up to the next price filling the excess orders as well as filling the orders placed at the next price. I am under the assumption limit orders are prioritized and filled first, then the excess market orders are filled second as well as new orders. If the excess market orders continues to be greater on the buy side than the sell side, the market continues to move up in order to meet the buyers needs. So basically as a result, we see movement in pips and price changes up. Same goes for an excess in sell money that has not been filled for the shorts.
Which leads me to where I am today. Here is a real world example of what I believe I am conceptualizing now. If I know that on the 15th and 17th of November( I add both days since they are half days together to make one full 24 hours), in NZD/USD the average excess money needed to purchase a pip (meaning that at a given price all orders are filled so that an excess of x amount of money is left over which in turn is what causes the market to move exactly 1 pip up/down) is $69,184.17 and on the 14th of November the amount of excess money to move the market up 1 pip was $68,427.32, I can see that the average value of the pip gained value from the 15&17th to the 18th by $756.85. Now when I pulled the information from the 18th last night I found an average value of 1 pip in the market to be $69,754.88. Compared to the 15/17ths average pip value, I noticed a positive difference of $570.70. Even though on the 18th the average value of the pip increased compared to the previous avg of $69,184.17, while decreasing in difference compared to the 15/17th of $756.85, I am led to make a generalized view of the market over the next day/several days. From my understanding, It would seem that buying momentum is waning and that selling momentum is taking over… Possibly tomorrow or in the next two days a sell trend will begin. I will have more conformation tonight after I pull the 19ths information and compare the values to the 18th like I did above for the 18th to the 15/17th. The values above are not the only values I use to predict daily direction, however I feel after doing my best to explain it above, I see a greater importance in the average pip value for a particular day if that makes sense.
I will be back later tonight with my new trades, Hope what I posted wasn’t to confusing. It’s hard even for me to understand and turn the conceptuals into written explanation and understanding.