Hi All, I was watching this GBP/JPY tick chart today while at work https://1forge.com/tick-chart/GBPJPY I know it's hard with broker's spreads to profit on such a short time frame, but, I noticed some things. You can get a good idea of buy/sell pressure by paying attention to who is pushing who. For example, if the bid is pushing up again the ask, or visa versa, if the ask is pressing against the bid. I noticed, before a big move this morning on the AUD/CAD, the ask stayed below the bid for 5+ seconds, then retreated for 5 - 10 seconds, then the pair dropped significantly. This brings me to my question: Have you guys found any useful/predictive data by watching a bid/ask tick chart?
The chart you were watching purports to be a "spot forex" one. The spot forex market isn't centralized. There isn't a way of recording, monitoring or collating its transactions, its volume, etc. etc. For this reason, the "information" that a spot forex broker can give you about transactions taking place, volumes, depth of market, and all these other parameters, relates only to their own independent, internal market for their own "product", which won't usually be representative of those of the interbank market at all. With the example you're asking about, therefore, it's very questionable, in principle, whether what you were looking at can have any realistic value at all to a potential trader. "Predictive" is a very tricky word, in this context, for the reasons explained here. As to whether there's anything useful about tick charts, my own opinion is that for centralized markets (that excludes "spot forex") they're better, overall, than timed charts, but less good than constant-volume charts. That's a personal perspective only, of course, and many will probably disagree with it. My reservation about tick charts is that they don't and can't distinguish at all between the transacting of 1-lot, 100-lot and 1,000-lot orders. For that, you need volume, but then we're back again to the problem that in the case of spot forex, a broker can show you only its own volumes (which are more or less garbage). In short, I can see no realistic value, myself, for the chart you're p̶r̶o̶m̶o̶t̶i̶n̶g̶ asking about.
One could make the same argument for any issue. Tic chart watching is very manic... too much so, IMO.
Understanding the limitations described above, adding a couple of T&S windows (one to filter for large transactions) and a DOM ladder support creating a better display of market data. It’s an ‘and/also’ finer toolset used in conjunction with charts and table views. Tick charts are useful in discerning ‘two pair’ price levels. A pair being a BBid/BAsk combination.
Please excuse a possible disagreement. It's unfortunate that this thread was titled "any value in watching tick data" but then focused not only on fx tick data but fx pairs. There is value in watching tick data, but not this, and a discussion of it somewhere else might actually benefit someone, particularly those who are attempting to trade price, especially without volume, indicators, shapes, etc. I don't know quite what you mean by "timed charts" since tick charts are linear, and "time" is part of their structure. It's possible and sometimes common to have more than one transaction per second, and in that case the ticks appear "bunched". But the time is metronomic. But as for the number of lots, that's not so important as the effect of the transaction. Does it propel price? bring it to a screeching halt? reverse it? How do other traders watching this transaction and its effects react to it? Do they pile on? Resist it? Struggle back and forth with it so that price begins ranging? IOW, the number of lots is not so important as traders' reactions to the trade (and I'm talking about actual recorded trades). But then I see no realistic value in the chart being "asked about" either. This chart is what I consider to be a tick chart. It tells me something, particularly with regard to buying and selling pressures, gaps (which can be extremely informative), and places of "rest". Not that I use it for very long, generally for only the first ten minutes or so. But if one is trading price, he can often do pretty well in that first ten or fifteen minutes. Enjoy your posts as always.
That chart looks tradable... same info you'd get on the 1-minute chart, though. That doesn't look "too manic".... much less so than an ES tic chart, however. So.... I'll stand corrected as applied "in some cases".