constant volume/tic bars are formed at differing intervals, obviously---right?
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Volume--- how to use it and WHY
- Thread starter marketsurfer
- Start date
constant volume/tic bars are formed at differing intervals, obviously---right?
Quote from heypa:
Proflogic
According to my very old Websters
Esoteric...Understood by or meant for only a few specially instructed or initiated individuals.
The definition is elementary.
So what YOU are saying is that; the very basic foundations of price and volume are only understood by a few specially instructed or initiated individuals.
That perfectly explains your comments in your posts, thank you.
Quote from marketsurfer:
constant volume/tic bars are formed at differing intervals, obviously---right?
NO!
First off, the term is Constant Volume/Share bars, ticks aren't constant. Ticks are transactions and each transaction contains a varying number of contracts or shares traded.
Second, the amounts, not intervals, are based on the specific volume the market produces not a volume variable such as time, tick, ranges or other calculation.
Quote from David Hume:
The depth of either side of the inside market does not constitute volume. Lifting of the bid or ask merely confirms my point that price may lead volume.
Nope! Look, price lifts nothing, ok. What does lift the market and its value is proposed business(quantities) at higher levels, if we're talking about an increase in market value or 'upside'.
Dackster.
Quote from David Hume:
The depth of either side of the inside market does not constitute volume. Lifting of the bid or ask merely confirms my point that price may lead volume.
The inside bid/ask is a location in a single dimension universe. On either side are the opposing forces of supply and demand.
The distance between the bid and ask will expand and contract depending on the amount of force behind each side.
Trades are the physical particles within this universe. Their elements are; time, price and volume. They are the byproduct of the conversion of the latent energy of supply and demand into matter and will be created whenever there is unequal amount of supply and demand present.
Entropy, the lack of trades, occurs when there is equilibrium between supply and demand.
When there is slight imbalance between the force of supply and demand matter will be generated with little or no movement within the universe. This can be considered background noise.
A minor imbalance can eventually degenerate into entropy or can create a regenerative feedback loop that attracts additional supply and/or demand to the current location.
Once a significant disparity in supply and demand exists the result is linear movement within the universe. This phenomena can be measured as the velocity and acceleration of trade particles.
If the imbalance becomes so great between supply and demand matter will cease to be created while the bid and ask spontaneously warps to a new location where matter can once again be created.
Works for me...
Jprad, add to your cosmology events in parallel universes where options, futures, and futures options on other instruments cause ephemeral market order haints and boojums to appear in your own universe. These can have nothing whatever to do with current price action where you stand.
Quote from David Hume:
I never cease to be amazed on ET at the persistence of Aristotelianism in a Cartesian age. The usefulness of volume is for ET's Aristotelians a matter of dogma they will not abandon even with the clearest counter proofs. The most casual observation of a one-second chart distinguishing volume at the bid from volume at the ask disproves their cherished belief. Price leads volume around by the nose like a pimp leads his hooker. Volume clearly is price's bitch. And what do the Aristotelians do when price moves with no relation to volume whatsoever, or when there is no discernible volume? No doubt they stand aside complaining of faulty data.
Interestingly put.
Whether one believes "price leads volume" or "volume leads price" the common factor is that the two elements are forever joined-at-the-hip like conjoined twins.
Problem solving is problem solving and is only accomplished one way. First you break down any problem to it finest detail. In the case of the Markets that would be the instrument that is traded which is either a contract or share (options are being omitted here for simplicity). Then you have the price at which "someone" is willing to pay for that instrument and "how many" of that instrument is available for purchase or sale. Regardless of how you "feel" about the markets this is a market fact. Time plays no part anywhere in or effects these basic fundamentals. Price doesn't go up simply because it is 9:00 am nor does it go down because it is 9:09 am. Time is not relevant to natural price movement or it's cyclic oscillations.
We may be looking at different instruments because what I trade moves like clockwork, albeit a cuckoo clock, or more properly an orrery made of sharp knives.
Quote from David Hume:
The T&S you see is based on an algorithm to match the book against trades. For latency and other reasons (like a big trade going "upstairs"), T&S is highly unreliable as to whether a particular trade was at the bid or ask, or as to what either of those even were at the time of the trade. This is easy to see when you grab the data stream yourself.
I agree that T&S can lag reality by a good bit, but I disagree that it's an algorithmic approximation of what really happened.
Trades that are recorded at, between, above or below the bid and ask are congruent with market orders that hit the inside bid/ask and limit orders that can join, improve or split the inside bid/ask.