thread: Order Flow - Achieving the mindset

92120

Living here in the Japan, the images on television are catastrophic.

Examining what happened to the UJ, orderflow can potentially explain a lot. Price originally spiked up 50 pips to take out stops above 83.10. Then dropped down (due to the vacuum?) ....

First move could be just traders leaping from long yen positions in spontaneous panic mode following the earthquake news hit the plank (NZD weaken a lot during first hours following the earthquake but this is different since NZD is higher return currency). Now with yesterday strong risk aversion theme, todays and long Yen TA installments terrible disaster, Yen at the discount price was very attractive. Just my 2c

92120

First move may be simply traders escaping from long yen positions in spontaneous panic mode after the earthquake news hit the board (NZD weaken a lot through first hours after the earthquake but this is different since NZD is greater yield currency). With yesterday strong risk aversion theme, todays and long Yen TA installments disaster, Yen at the discount price was quite attractive for speculators. Just my 2c

Thumbs up green! First reaction is knee-jerk. Fade it.

92120

Thumbs up green! First reaction is knee-jerk. Fade it.

With the greatest respect that's easy to say after the function. The reality is not quite that easy I am afraid.

92120

With the best respect that is easy to say after the function. The fact is not that easy I am afraid.

Ofcourse, you're right, doctor! I should not have written it that way and I am happy you corrected me.
The truth is that I have been studying a number of it and my conclusion is that (don't take my word for it!!) IF the price action after a news event or something from the like seems to be incorrect it uninformed order flow and will be faded. Do not want to say to much here (no bullshit - it's not that I am attempting to conceal anything. . I simply have't got that much yet) however, it seems to me that the majority of the news events look like this.

Thank you for pointing out it doctor, you're right there and expect everybody understand what I am talking!

Ps: I am looking for great essays and other little PDFs/ebooks about market microstructure/FX-microstructure/zero-sum (and all of that). . Do you guys have any you can post ?

Thanks!

92120Fade the defenders and vanish the hunters are another step.

92120OK....Anybody has some idea why USD has been sold so strong today?

Is it the friday thin liquidity or QE3 just kicked in
There should have been some large stop orders over the 1.3850.

92120

OK....Anybody has some idea why USD has been marketed so strong today?

Could it be the friday thin liquidity or QE3 just kicked in
There must have been some large stop orders above the 1.3850.

I was looking in to that too. I think a lot of USD were purchased through the USD/JPY stop hunt rise that could cause a selloff. I'm not sure it was of bc USD/JPY found liquidity or if value traders focused on the USD/JPY pair but the dollar was purchased up again. Now its headed back to previous levels through selling.

92120

I was looking in to that too. To begin with, I feel a lot of USD were bought through the USD/JPY stop search rise which could lead to a selloff that is more powerful. I'm not sure it was of bc USD/JPY discovered liquidity from 8-10amGMT or if value traders focused on the USD/JPY pair but the dollar was bought up. Now its headed back to previous levels via selling.

I want I would know something but I am unable to extract one clear thought from this. It seems way to apologize for my day frame of mind.

92120lol sorry. I ment there certainly were a lot of USD longs trapped on the wrong side of this market today which is currently accelerating a selloff.

66950

Fade the defenders and vanish the hunters are the next step.

UP, could you elaborate?

For me, it seems like evaporating the defenders and evaporating the hunters are mutually exclusive. To put it differently, if the defenders're evaporating, then you're trading with the hunters.

I guess you may be indicating to fade the defenders (trade with the hunters) before the stops are triggered, then fade the hunters (fade the stops) while price goes back to its perceived worth.

Is that close?