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  • #21
  • Nov 17, 2019 11:53pm Nov 17, 2019 11:53pm
My Price action? I dont get what you mean by that.
I said you need all 3 things 1PA 2volume 3deltas but I would include a few more things. Context is everything. Without context (PA and others) orderflow will trip you up as it gets manipulated in certain insto areas.

You have demonstrated abs exh and ds. Thats good. Its not wrong and I hope you can make consistent $$$. But imo your issue will be context and a deeper understanding of deltas use and liquidity. Also not taking advantage of targets and risk. which are vital to an easy life of trading.
pointless debating this (not that im debating your work above as I agree with it - just want to see more included)
I cant show examples or get involved, so all the best.



I wont be posting anymore. I realise as much as I want to show things I cant. And trying to discuss in code serves no purpose.
  • #22
  • Nov 18, 2019 3:39am Nov 18, 2019 3:39am
GBPJPY , if low volume and wide range candle at 141.279 - 141.300 then SELL
  • #23
  • Nov 18, 2019 4:07am Nov 18, 2019 4:07am
set sell limit at 141.35
  • #24
  • Nov 18, 2019 6:15am Nov 18, 2019 6:15am
Quoting failinforex
set sell limit at 141.35
In retail forex it is manipulation, and volume give some clues - low volume and wide range bar (stop hunt); or high volume followed by 50% or more retrace of wide range bar ( no more fuse; exhaustion).

close at 141.17

Attached Image
  • #25
  • Nov 18, 2019 8:02am Nov 18, 2019 8:02am
Quoting YYZ
{quote} Based on your respond to me I am sorry to participate in this thread. I will delete both of my posts to have no record in this thread...you delete your reply to me. no need to reply to this one...will be deleted within 24H
There are those who simply can't handle or don't know what to do with the truth...come back again soon...
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  • #26
  • Nov 18, 2019 8:11am Nov 18, 2019 8:11am
Quoting failinforex
In retail forex it is manipulation...
It is this (forgive my word here) paranoia that creates failure (IMHO). Again I repeat the market is made up of Trillions (with a "T") dollars. It would require all the money of the top 5-6 richest people in the world to create the kind of manipulation you speak of. And you think they are doing this for your tiny little micro lot or mini lot position...really?? Think logically. I have spent several long and well thought out posts to try and explain this to all of you. It is not necessary you believe me...but the truth is the truth. It doesn't work any other way. The truth doesn't require you to believe in it..it just is.

To use an analogy. You can tell me how many different colors the sky is made of...and even show me pictures of the sky at sunset and at dawn and show me the various and pretty colors...but the truth is the sky is blue and even though I explain to you the "prism effect" of the atmosphere and tell you that while yes in this instance it seems the sky is many colors it is really the effect of the sunlight being split by the atmosphere. But the underneath that the sky is still blue.

It doesn't matter if the you don't believe it...the sky is still blue. It doesn't matter if you don't believe the structure of the market is what causes prices to rise and fall...it still does.
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  • #27
  • Nov 18, 2019 8:55am Nov 18, 2019 8:55am
OK...lets review:

  1. "The Market" is simply a computer that matches orders, buys with sells, aggressive with passive when two parties agree upon a price to transact.
  2. For everyone that wishes to interact with "the market" you must do so by placing orders via a broker or a bank

    1. No order will be accepted until it has BOTH a price and size (volume)

  3. There are literally thousands of orders coming into the market every second of every minute during the session of any given market
  4. This "flow" of orders and their respective volumes are matched together and when combined (Market orders with Liquidity) leave some surplus market orders still waiting to be executed because liquidity has been used up.
  5. This surplus creates price movement, be it ticks, or major moves.

    1. Surplus buys waiting to be filled will create up-ticks or rises in price
    2. Surplus sells waiting to be filled will create down-ticks or falls in price

That's it!! How simple is that...This is the entire "structure" of the market. While we'd like to make it more complicated, it just isn't.

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  • #28
  • Nov 18, 2019 9:27am Nov 18, 2019 9:27am
So now lets talk a bit about "Delta"

Delta - A fancy term meaning "net" volume. I just love how we as humans love to make something out of nothing!! We create complicated sounding terms to somehow impress out peers with our "great knowledge" when this concept couldn't be more simple.

There are many uses for this concept but simply put it is this: In any given candle there are always sellers and buyer who are participating. These participants engage both as active (aggressive) and as passive (liquidity). Imagine the trader who opens his Long with a market buy order but also sets a sell limit order at a specific target. His/her entry is "aggressive" yet his exit is "passive". This trader has contributed to only ONE side of the delta order flow...the entry. Most delta volume (especially in FX) is registered on the aggressive side (or market order side). So let me explain it to you this way.

Our trader above, decided (however he decided) to enter the market "RIGHT NOW". And as a consequence transacted using a market order which was placed in the queue and transacted against available liquidity. A buy "tick" was registered at this transaction. But why a "buy" if there were both seller AND buyer. The buy is registered because it was the active request to transact "right now". Where as the passive participant placed their order long before and had no time constraint on how quickly her/his order was filled. (Remind me to talk in a future post about "time").

So because of the "urgency" or "enthusiasm" or "aggressiveness" of the buyer, the tick was registered as a buy. Now our trader has a long position and is waiting to exit the market at his target. If his target hits...he is out and the "tick" that took him out was ALSO a buy!! WHAT??

Yes!! Remember that his take profit order is a "LIMIT" order. Meaning it is passive and he is willing to wait to sell. He/she has declared this as soon as he posted the order. Therefore the opposing side (counter party) that filled her/his sell order was also a Market buy. So because his/her passive order was filled with an aggressive market order the tick that closed his/her trade. Take a moment and think about this. Active entry, passive exit. This is a very common scenario.

So what does this have to do with DELTA?

What if we could look at a given candle and "see" which side of the order flow was most dominant? Would that effect your decision making? Further, what if you could look "inside" this candle and "see" which price level was the area where buying (or selling) established its dominance? What if you had decided you wanted to enter a buy order (to go long) but were able to see that at that moment in time selling was most dominant? Would that cause you to rethink your decision?

Delta gives us this ability. First of all in this way: The entire candle. This data point is taken when ALL the ticks of the course of an entire candle are added up and then compared. Lets say it this way; buying ticks = 30 and selling ticks = 10; This gives us a NET (or delta) of +20. With me so far. Clearly buyers were more dominant than sellers. And because these are all aggressive transactions or market orders it would seem clear that we should expect prices to have rising during this candle. Thus if prices did indeed rise all is well with the universe. However if prices did NOT rise something is amiss... got it?

Let look at this again:
Attached Image


Down at the very bottom is "delta" you see that buying was more dominant than selling AND price rose as a result.

Here is an example of a selling dominant candle:
Attached Image

so on the surface all seems well. Selling dominance...prices fall. The market is doing its job
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  • #29
  • Nov 18, 2019 9:58am Nov 18, 2019 9:58am
In addition to the above, Delta volume can also be calculated at each and every price level. Again to review, we are looking at the "aggressive" side of the market so when we see aggressive buying we expect it to cause prices to rise. Likewise when we see aggressive selling we expect to see prices falling. ANYTHING else is anomalous and aberrant. You will soon see that these aberrancies are big clues to price inflection points. But I digress

So what if we can "see" the order flow dominance at each and every price point within a given candle? Would that be valuable information? Lets look again at a series of three candles:
Attached Image

Again we see buying dominance especially on the leading edge. You can see that right in the middle, price stalled for two bars, then continued. Also of note is that the buying delta at the end was markedly higher than the buying delta that preceded the stall. All looking good and "bullish". But what if I told you that there was some trouble brewing in those last two candles? Would you call me crazy? Lets look INSIDE those candles:
Attached Image

Same candles (each histogram is one candle) But now INSIDE we can "see" what is really going on. We can see that it was large blocks of selling that created the stall in price...yet those candles on the price chart show BUYing delta. While buying was clearly the more dominant order flow...there was sufficiently strong aggressive selling to stop price advance and stall it for two days. As price fell buying came back in aggressively and price not only rise but then started stopping out the short positions (causing another wave if market buying to hit the market). And while price did advance it was not "new" longs that were advancing the market it was really shorts stopping out...lots of them. So many in fact that the delta on each price bar was significantly greater than before the stall.

The final straw is the last candle. The aggressive sellers have given up. They may have even Stopped and Reversed. All the aggressive buying is at or near the highs of the candle. No selling (or very little) seen at all...so here is the question: With all this aggressive buying, why isn't price skyrocketing higher?

The answer will be in the next post...mid-morning for me...daily trade is done...time for more coffee!!

Let me leave you with this question. Can you see the value of reading and seeing the order flow inside each and every candle? If you were long on this scenario...and you knew there might be trouble ahead with price continuing to advance...wouldn't you just exit and keep your profits?
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  • #30
  • Nov 18, 2019 10:17am Nov 18, 2019 10:17am
Quoting DonPato
{quote} It is this (forgive my word here) paranoia that creates failure (IMHO). Again I repeat the market is made up of Trillions (with a "T") dollars. It would require all the money of the top 5-6 richest people in the world to create the kind of manipulation you speak of. And you think they are doing this for your tiny little micro lot or mini lot position...really?? Think logically. I have spent several long and well thought out posts to try and explain this to all of you. It is not necessary you believe me...but the truth is the truth. It doesn't...
First off I would like to say thank you for starting this awesome thread, I find a lots of information pretty valuable even though this is only page 2!

I just want to delve deeper and perhaps explore a bit regarding market manipulation since this is quite a controversial topic, a bit difficult to wrap my head around and I am 50/50 on this.

I DO NOT believe that the market is out to hunt for my retail trader stop losses, since the popular believe is that 90% of retail traders fail in forex, it can be said that 90% of retail traders are trading in the so called "B books", which means that most of us are actually just trading against the brokers, I think most brokers are using a hybrid model even if they claims to be true ECN brokerages, meaning that the 90% losers will trader against them while only the 10% winners will have their orders trading against what is available on the market. With this out of the way, I agree with DonPato that we are simply too small for Mr Market to even care about existence and positions.

The idea of stop hunts is interesting, but I think perhaps we can look at this in the following way. I believe that the first thing that most people were taught about what to look at on the chart are support and resistance levels, and these levels normally contains multiple previous swing highs and lows. It is hard to believe that professionals places their orders in completely arbitrary levels, so I believe that they most likely also look at major support and resistance levels to place their orders. And this lead me to believe that the area where the most limit orders and stop orders are placed are at these support and resistance levels +/- few pips depending on the fx pair. For professionals to enter the market, due to their position sizes, in order to avoid slippage, they need a lot of liquidity, and if we say that those S&R levels are where the liquidity will be concentrated, those levels will always be an area of interest for the professionals. When it comes to retail traders stop losses, we always places our stop losses a few pips beyond those S&R lines, I believe those locations are where most of us learnt to place the stop losses. So my thinking is that this sense of retails traders being stop hunted were created because we always places our stops at places where professionals are interested in entering the market.

When it comes to market manipulation, I hold a different view though, I think market manipulations do happen, the first one that came to mind on fx is the libor rate fixing scandal which was found to be manipulations of couple of trader at top banks working in collusion, basically they were filling their big client's order at worst price while front running their own accounts at the same time. When the top few banks have so much money to work with, have the order books in front of them and are well contacted with the other major players in the market, I don't think it is too far fetched for them to be tempted to collude, this happens in most industries, let alone one that is one of the most lucrative. To clarify, I don't think they constantly manipulate the market though since that would take way too much money, I think they just do it in a way to nudge the market in their intended direction for a very short period. I think they do try to push price beyond S&R levels doing SAR, triggering stop orders and entering at better prices, depending on the time of day and fx pair, they can probably move the market 10 pips at a cost of 50 million USD (500 lots) which I think is probably not a lot of money in their eyes. They can also remove the liquidity or enter the market at times of low liquidity, thus creating a large spread but low volume candle which can have various enticing effects, I don't think this is too hard to do especially when the order book is available.

So in conclusion my thinking is that no I don't think the professionals are actively trying to screw the retail traders in the fx market (can't say the same for stock markets though since it is so much smaller), the targets are probably the less informed companies needing to exchange money for their day to day or other smaller institutions / funds. But I do think the market is manipulated in a small extent in order to get better prices or entice people to enter at bad levels.

Hope what I wrote makes sense, it serves to organize my thinking and I am all for positive criticism, it lets me see where I am wrong and learn something, so I am keen in seeing what everyone thinks!
  • #31
  • Nov 18, 2019 11:07am Nov 18, 2019 11:07am
Quoting Han2019
First off I would like to say thank you for starting this awesome thread...
Thank YOU for your kind comments. I hope you will find value here and will be able to use this information to improve your trading

Quoting Han2019
.... I just want to delve deeper and perhaps explore a bit regarding market manipulation since this is quite a controversial topic, a bit difficult to wrap my head around and I am 50/50 on this...
I find it extremely difficult to understand WHY people are so obsessed with this topic. But to indulge this for just a moment let us look at it this way. Let just say this DOES happen, regularly. How are these larger institutions going to create these "manipulative" movements? Take your time and think about this....

ALL participants...ALL of them. Yes even the market manipulators MUST do so by using and entering ORDERS into the system. They cannot call XYZ exchange and say start quoting prices at 1.xxx. They have to participate using legitimate orders with the liquidity to back it up. Those large orders by definition will come across the order flow and you will SEE it.

So to return to this question of market manipulation...does it or doesn't it exist? WHO CARES!! If you can use see those orders come across the order flow and watch price respond to it YOU have the advantage and you didn't have to use millions (or billions or Trillions) to accomplish it.

Quoting Han2019
.... It is hard to believe that professionals places their orders in completely arbitrary levels, so I believe that they most likely also look at major support and resistance levels to place their orders. ...
These "professionals" have the same access to the same order flow as we do. They simply have more sophisticated data feeds, and at times a direct data feed coming direction off the exchange. You and I have access via a broker. This does constitute an advantage of sorts - milliseconds at best. But "major support/resistance levels"...it is their order flow that creates these levels in the first place. It is their absorption of selling (via passive liquidity) that creates "support"...and likewise for resistance. These Professionals don't look at support they create it. The concept of "deep" or "dark" liquidity pools comes to mind here. These are levels where large concerns have "hidden" orders of deep liquidity that are activated via OSO orders. To briefly explain. An OSO order is an "Order Sends Order" You can set up an order to trigger at a certain price (much like a stop order). But instead of activating a market order it activates more limit orders at prices just above or below the market (which ever way price is going). These "pools" have large sizes..."deep liquidity" which require many many many market orders to use up...in fact most time they are NOT used up and once the aggressive market orders peter out...price moves away from these areas.

The professional manipulators don't look at these levels...they actually create them.

Quoting Han2019
.... When it comes to market manipulation, I hold a different view though, I think market manipulations do happen, the first one that came to mind on fx is the libor rate fixing scandal which was found to be manipulations of couple of trader at top banks working in collusion, basically they were filling their big client's order at worst price while front running their own accounts at the same time. ...
This is a matter of fact. It was (and is) illegal and these people when caught were arrested and punished. As I mentioned earlier this kind of manipulation does occur...and who is the biggest offender the will never be punished...the US Federal Bank. They regularly manipulate the markets by out and out printing money creating supply or taking money of the system, creating demand. No one complains about that in their trading however.

If you want to look at who is "cheating" or manipulating your prices...look at your broker. You are basically engaging in a game of poker and the other guy can see your cards. Your broker is the counter party to all your trades. They can "see" where you place your stop and limit. They quote not only the current price but can also manipulate the spread up to 20 pips. THIS is the guy "hunting" your stop...not the market. The broker carries all your mini and micro lot trades because your combined volume is just too small to put out to his liquidity provider. So as any good bookie would do he/she tries to keep the betting even on both sides...because this is after all a zero sum game. He wants EVERYONE to lose so he doesn't have to pay anyone. This is why many have computer programs between themselves and their brokers to "hide" their orders...and this program executes essentially 100% market orders. I can name good and bad with this but that is beside the point.

At our level, market "manipulation" is irrelevant and can actually work in our favor IF we learn to read and interpret the order flow/volume.
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  • #32
  • Nov 18, 2019 3:17pm Nov 18, 2019 3:17pm
Quoting DonPato
At our level, market "manipulation" is irrelevant and can actually work in our favor IF we learn to read and interpret the order flow/volume.
Lots of great insights here. Thanks for sharing. I chose just this last sentence as I think it aptly sums it up.
If in doubt, paddle out!
  • #33
  • Nov 18, 2019 4:05pm Nov 18, 2019 4:05pm
Thanks for the detailed reply @DonPato!

For me, my thinking was to recognize the different ways of manipulations to exploit the opportunities that comes with it, but I believe that this thread will offer a different approach which at the end of the day will also provide market opportunities and I will be following this closely!

The OSO type order is new to me, so I am not sure if my understanding is correct, but if I am thinking that it comes with 2 distinct advantages and maybe you can correct me if you don't mind?
The first advantage I can think of is that since it only activates after an order is triggered, it hides the pending limit order like the dark pool that you mentioned.
The second advantage is that these OSO orders are probably one big positions spliced into multiple smaller OSO orders, so that the position can be accumulated without causing slippage which comes with placing one big limit order, the trade off here will be that it takes longer to accumulate and not all the orders will be filled.

So I imagine that this type of order will probably cause low spread but high volume candles, with multiple tests at this area without breaking, before an eventual moves to the opposite direction.
  • #34
  • Nov 18, 2019 4:28pm Nov 18, 2019 4:28pm
I am fascinated..... your conversation answers so much of the knowledge I have been seeking.

Thanks please continue!!!
Stay green!!!
  • #35
  • Nov 18, 2019 4:50pm Nov 18, 2019 4:50pm
Quoting DonPato
Lets look again at a series of three candles: {image} Again we see buying dominance especially on the leading edge. You can see that right in the middle, price stalled for two bars, then continued. Also of note is that the buying delta at the end was markedly higher than the buying delta that preceded the stall. All looking good and "bullish". But what if I told you that there was some trouble brewing in those last two candles? Would you call me crazy? Lets look INSIDE those candles: {image} Same candles (each histogram is one candle)
Without fail, everyday learn new insight to demystified forex trading.
Not that I want to push my view pertaining manipulation, I too hope that it can be convincingly debunked.

May I ask what is that indicator with histogram.

But if you said our broker stop us out, this is hard to comprehend.

Let said I BUY EURUSD at 1,000 my stop loss is 950 ($50)

Another guy with another broker SELL at 5000, his take profit is 950.

If my broker hunt my stop loss and took me out. The other guy with the other broker will have a win fall.

Will his broker allow my broker to push price down to 950.
  • #36
  • Nov 18, 2019 5:01pm Nov 18, 2019 5:01pm
Quoting Han2019
Thanks for the detailed reply @DonPato! For me, my thinking was to recognize the different ways of manipulations to exploit the opportunities that comes with it...
This will be covered soon when we start learning about exhaustion and absorption. But if you want a head start on the subject please have a read another of my threads: Hey...what about Volume?

Quoting Han2019
...but I believe that this thread will offer a different approach which at the end of the day will also provide market opportunities and I will be following this closely! ...
Again, just to be clear...this is NOT a methodology or a trading system. It is simply how the market actually works. So many of us engage in these kinds of market activities and what is really very financially perilous behavior with out really knowing what it is we are doing and what it should be that we look for. And then wonder why we lose money.

Quoting Han2019
...The OSO type order is new to me, so I am not sure if my understanding is correct, but if I am thinking that it comes with 2 distinct advantages and maybe you can correct me if you don't mind? The first advantage I can think of is that since it only activates after an order is triggered, it hides the pending limit order like the dark pool that you mentioned. The second advantage is that these OSO orders are probably one big positions spliced into multiple smaller OSO orders, so that the position can be accumulated without causing slippage which...
You are exactly correct. This method of positioning large orders "hides" it from the order book until the last minute thereby catching most of the "smaller fish" traders in a net forcing them to either close out or stop out. And their actions (not those of the deep pool) are what cause the market movements to "rocket" out of the pool areas, instantly bringing profit to those of us who are able to see it in real time.
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  • #37
  • Nov 18, 2019 5:02pm Nov 18, 2019 5:02pm
Quoting Froggy
I am fascinated..... your conversation answers so much of the knowledge I have been seeking. Thanks please continue!!!
I am gratified that you are finding value here...please contribute as soon as you have questions or something to add.
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  • #38
  • Nov 18, 2019 5:03pm Nov 18, 2019 5:03pm
Quoting DonPato
{quote} I am gratified that you are finding value here...please contribute as soon as you have questions or something to add.
Thank you, I certainly will.
Stay green!!!
  • #39
  • Nov 18, 2019 5:06pm Nov 18, 2019 5:06pm
Quoting failinforex
...But if you said our broker stop us out, this is hard to comprehend. Let said I BUY EURUSD at 1,000 my stop loss is 950 ($50) Another guy with another broker SELL at 5000, his take profit is 950. If my broker hunt my stop loss and took me out. The other guy with the other broker will have a win fall. Will his broker allow my broker to push price down to 950.
Not all brokers do this...but many who are unregulated and lack transparency do. The answer to your question is simply a widening of the spread. Of course it doesn't go as much as 50 pips normally but once price is within 10 pips or so, the broker can pull the bid price down (the side of the quote that stops you out) but leave the ask where it is, (the side that must hit for the short to profit). Once the longs are stopped yet the shorts are still waiting, the broker can then spike the price up to take out the stops on the shorts...viola!! Everyone loses.
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  • #40
  • Nov 18, 2019 5:11pm Nov 18, 2019 5:11pm
Quoting DonPato
{quote} This is a matter of fact. It was (and is) illegal and these people when caught were arrested and punished. As I mentioned earlier this kind of manipulation does occur...and who is the biggest offender the will never be punished...the US Federal Bank. They regularly manipulate the markets by out and out printing money creating supply or taking money of the system, creating demand. No one complains about that in their trading however.
Let said Feb and the billionaire club is one single entity (syndicate), they are happily making money - HENCE manipulation does occur...and who is the biggest offender the will never be punished

Let said 2 smart alec found a way to beat them - THEN It was (and is) illegal and these people when caught were arrested and punished.
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