Technical analysis of the book

Discussion in 'Technical Analysis' started by travis, May 22, 2005.

  1. travis


    Will you share your insights about how the book, of the Minidow future for example, works?

    What I could see so far is that when we have an upmove, the tenth level of the ask is more crowded than the tenth level of the bid, contrary to what I was expecting.

    I couldn't observe all the levels, but it seems that on the tenth level volume works as a magnet, "attracting" the price, higher or lower, rather than pushing it.

    In other words, during a rise, the bigger volume (not intended here as executed trades) almost all of the time on the tenth level of the ask, and viceversa.

    When the price doesn't move, it varies.

    I don't know how all this could be useful in my trading, because I am not saying that when we have higher quantities on the tenth ask level, we start rising. I am only saying that when we rise we have higher quantities on the tenth ask.

    Maybe one way of using this information is that when we see that during a rise the quantities on the tenth ask are decreasing (I mean the ration between the quantities of the bid10th/ask10th), the rise could come to a halt. And it does happen that way, but this doesn't exclude that such quantities will increase again and the rise will continue.

    So I would like to learn some more about this, if anyone wants to share their views on this topic.