I often wonder about the validity or usefulness of large orders at the Bid or Ask as an extra signal for entry or exit. I know that Anekdoten of AHG fame has posted some remarks about watching Time & Sales at entries. However, I personally find it confusing as I have seen time after time again, large orders being filled at the B/A do not portend direction. I think that perhaps some arbitrage programs are buying and selling large blocks of futures & underlying stocks or SPY's. if they have the opportunity. I am leaning towards not watching the Time & Sales at all as I tend to become more confused and may miss my entries for that reason. Stone
You may notice that price will move TOWARDS large volume - especially when sum of once side (bids or asks) is 2X+ the sum of the other side (asks or bids). This is counterintuitive (if you want to read more about this subject, there's a thread or two on here that covers the subject). Also, watch for false b/a volume....often there'll be numbers showing several thousand a tick or two below the current price, which disappears as soon as trades occur at this price. These false bids/asks are designed to deceive in faking support or resistance. Again, price will usually move through these areas. While I do pay attention to the DOM activity prior to entries (particularly watching for that 2X+ phenomenon), I only pay attention to T&S after entry to see if trade volume (on the larger orders) is supporting my direction.
kinda died in here... hope everyone's still trading well. attached is a compliation of Anek's thread. OP, do you have anything to post? Thanks JW
JFW, that is awesome... I was almost done reading the original thread and taking notes, but having this as a reference is fantastic... Really helps hit home the "main points"
no problems man. Anek and the rest of the gang did a lot helping all of us. we have to keep this going. i wish i could be more active but i got a full time job. i think the tread can be kept going if we kept our focus on the core principles of PA and not diverge into other areas. Just looking at the chart, looks like we closed below 1200, a key support. tomorrow we may see a nice jump. but no predictions, just follow PA. Anyone trade today?
I agree guys, things are somewhat quiet here as of late. Here's my contribution to the thread (chart attached). I sometimes cringe when I hear the word "prediction" tossed around loosely however, there's absolutely nothing wrong with measuring out potential price moves to either the upside or downside while piecing together a course of action to take if proven right or wrong. Key is not to have a bias to either direction and just be prepared to adapt to movement of the price action. With that said, I mentioned a while back that I would provide some insight as to what I was seeing on a much larger time interval...the weekly chart. I was initially anticipating a 50% pullback to 1320 (H of 1441 and L of 1200.75) in the ES as my area of interest to short. Needless to say, the pullback stalled at 1313.50 and then could not break above 1306 the following week. My SDS trade occurred around the 1301 region of the ES and as you'll see by the chart I attached, I've just moved my stop up to the 67 level today after the close. I'm expecting a pullback now that price has closed above the 72.50 level. I'm prepared to react if old Resistance does not prove to become new Support. The trade: SDS Oct08 69 Calls bought @ 1.85/contract. Take care, Tex
Has been quiet. I still check the thread everyday, but unfortunately I have little to offer. Will try to post up some stuff!
If anyone can tell me how to copy charts from CQG...I'll start posting mine again....hate to see a valuable thread die.... Keep up the good work guys, and keep posting for better or worse! -traderTX