Monday market. Probably mostly technicals in play until us or euro market open i guess?
Seems so Jack, best to wait for NY opening.
Hi Guys,
LIVE ORDERFLOW TRADE
I am doing a live trade on the AUD/USD. Here is snapshot before entry. I am bearish on the Australia economy as a whole. Dali already mention his sentiment analysis on the AUD/USD
Sell Limit: 1.02785
Stop: 1.03028
Profit Target: 1.02500
Good Luck
3 hours later i finally took my profit. Here is my snapshot. Live trade called and took profit. Need to go to sleep Good night
29 pip profit
Nice, good job omgwen! Right into the sub-1.0250 stops! 
I didn’t take any FX trade today, will switch now to futures trading. Caught the break lower in ES on the open, looking now for further momentum trades.
I ended up trading FX after all, after ES got quiet. Long EUR/JPY with a 130.00 target, I’ve moved my stop to breakeven.
Why I took the trade:
EUR/USD was hitting into sovereign bids around 1.3020. As we learned previously, we should keep an eye on the actions of sovereign players as they can influence the market and short-term bias. This was the case again today and as the EUR/JPY triggered stops below 129, I was looking for upside momentum to enter long. I choose the pair because it is more dynamic than EUR/USD, but you see that the same concept could have been applied in EUR/USD.
I’m also long USD/JPY as I’m looking for this squeeze of long positions to be filled. I got an entry at 99.30 with a SL at 98.90 and 99.85 TP.
I agree with you shere, that is exactly what I want to teach people here. Not looking at OFT as a plain trading strategy, but rather as a mindset. Like you mentioned, it is certainly not easy for newbies, because it requires to think in a way that is completely opposite of what they’ve learnt before.
Like everything else, it comes with practice. Once we start to question price action and why certain things (i.e. stop hunting) occur in the marketplace, we are on the path to gain an advanced insight and develop a strong edge in the markets.
Finding the stops on the charts is not a difficult job and you can identify larger cluster of orders at common Supply/Demand levels. The more difficult part is sentiment reading and thinking about the actions of other participants, but this part is what seperates the average losing/breakeven trader from the successful/consistent trader in my opinion.
Possible stop hunt set up in AUD/JPY down to sub-100.50 and sub-100 stops.
Sentiment is generally negative and AUD looks quite bearish, especially after last nights PMI figure from China.
Dali - Bang on the money.
They found those sell stops below c13000. It’s a “cheap” and smart way to protect their c12950 Barrier option for today’s 10am NY cut. Let’s see how far they are going to get before they hit the top level Barrier protection. It’s all fun without conviction these days.
I agree Minotaur, it seems the best strategy for EUR/USD currently is to fade extreme moves in either direction. Sentiment is a bit unclear. Sell stops obviously below the 2950 barrier and buy stops above 3080.
Are you focusing on E/U or any other pairs you trade frequently?
The common denominator for instruments to trade is always the most important factor, and those 3 are:
- a clearly identified dominant bias
- high probability/lower risk opportunity
- a logical technical reason for executing the bet
I haven’t traded this week. I’m happy to sit aside and wait to see if anything develops over the course of this week. I spend far more time sidelined than I do active because I’m very choosy about what I place my money on, which is a direct result of the market teaching me valuable lessons about triggering dodgy entries and not paying sufficient (fundamental) attention to what’s playing out around me and influencing the market momentum/volatility.
Here is a simple sheet you can use for your order flow analysis (see attachment for PDF).
Date: 30/04/2013
Pair: EUR/USD
Key Technical Levels: 1.3050, 1.3030, 1.30, 1.2970
1.3120, 1.3150, 1.32
Buy Stops: 1.3130, 1.3160
Sell Stops: 1.3040, 1.3020, 1.2990, 1.2940
Risk: On
Currency Sentiment: Mixed
Sentiment Analysis:
Markets expect a rate cut on Thursday and combined with weak economic data, Euro rallies should be limited. Larger selling interest is present at 1.3120, including offers from sovereigns, and up to 1.3150. Demand seen from 1.3050 down to 1.30, with sell stops through.
Strategy:
Current sentiment (risk on) indicates we will likely go for a test of the 1.3120 level. But with the ECB meeting in two days, fading any extreme moves within the range seems the best approach.
Order Flow Trading Sheet.pdf (41.7 KB)
Hi Dali,
I have been getting problem with the general placement of my fade trade and swing trades. My strength lies more with pushes with sentiment.
Can you please show an example of a successful fade trade and a Swing trade?
I am interested in your general entry spots and exits. Thank you
Good luck. Expect that twine would not find closed such as past an individual’s.
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dali what fading the stops mean ? is it same as stop hunting ?
Hi extreme,
Stop hunting describes the process of “pushing” into the stops. For example, if we are aware of large stops below 1.30 in EUR/USD and we enter short targeting those.
Fading is the opposite. We would wait for the stops below 1.30 to get triggered and go long. But apply this only when sentiment is clearly positive, you do not want to go against momentum. If sentiment is positive and we see price heading lower into sell stops without any fundamental reason, we can assume large players are accumulating positions.
Hi omg,
Like I just told extreme, you want to apply “fade trades” only when sentiment is clear and price is going counter-sentiment without any fundamental reason behind it. The recent rally into 1.0380 in AUD/USD is a good example, short-term players who were short got squeezed out and large players used the opportunity to accumulate fresh shorts or add to it.
If you are doing fine in pushing into stops going with sentiment, stick to it. Especially if you are new to this, there is no reason to try applying many strategies. Build your trading skills applying the strategy that fits the best to you and stick to it. Consistency does wonders!
I went short EUR/USD and GBP/USD at current levels.
EUR/USD
Large selling interest reported at 1.3100/05 and larger sell stops from 1.3020 to 1.3010, which are my target. Sentiment is EUR-negative and I think there is a high probability we’ll move towards the reported stops. If we’ll reach 1.31 first, I’ll monitor price action and if the signals are clear, I’ll add to the short position.
GBP/USD
Bias not that strongly as in EUR, but looking at PA, it seems ready for a test of 1.5465, which is my target. We’ve cleared already a good deal of traders positioned short in G/U and it is time to get some of the short-term sell stops too.
So you enter a short trade @1.3072, TP 1.3010 and SL @ ??
EUR/USD SL at 1.3120. If I’ll add a 2nd @ 1.31, the stop will be at 1.3135.
GBP/USD SL is at 1.5560.
Looking to hunt my stops? 