around 11:48 ish I saw 8000 flash on the offer side after a sustained upmove on decling vol. I took it as a sign of a seller in waiting. Sure enough we drop 9 points off that level.
Why DOM is Deceiving
- Thread starter increasenow
- Start date
Well, there's lots of ways to trade. In my case, it's frequent daytrading or scalping of futures contracts.
If I did not have the Market Depth analysis, I couldn't make it because, most of the time, ONLY the Book Analysis tells me the most about which way the market is headed, in conjunction, of course with several other indications.
For me, "The Book leads the Price".
The DOM or Market Depth is a short term indication, however, so it does apply to the bulk of traders.
"That's just my story, and I'm sticking to it !!"
FS
If I did not have the Market Depth analysis, I couldn't make it because, most of the time, ONLY the Book Analysis tells me the most about which way the market is headed, in conjunction, of course with several other indications.
For me, "The Book leads the Price".
The DOM or Market Depth is a short term indication, however, so it does apply to the bulk of traders.
"That's just my story, and I'm sticking to it !!"
FS
It's not just the size on the book, but you want to see a trade at the ASK which is substantial, *corresponding* roughly to that advertised size. In other words, the MM (or big seller) actually sold at that price (rather than backing away, which would have been a "spoof").
In that case, if you can determine that it was truly a large trade to the ASKing price, it's a good indication that a down move will begin shortly.
By my way of thinking, that's a natural consequence of the fact that the large players can push price. In this case, the large player sells and naturally wants price decline before buying.
FS
Interesting chart. Should one study and pay attention to the divergences on your chart?
Look at Cumulative depth volume over the last few ES points!. Whenever one side of the market is larger, that is where you want to place your trade. Example, if there is large orders on the offer, you want to buy, if there are large bids, you want to sell Basically do the opposite of what others are looking at
Buzz
Buzz
The acv ratio is the only part of the DOM that I pay attention to and it can enhance good entry points imo. If I have one of my macd/stoch signals that aligns with a acv ratio around 2 to 1 on the DOM, then I try to let these trades run. I have found price direction or intraday trend changes seem to happen a lot after a acv 2:1 ratio price pivot.
You are an interesting example of an entry/exit trader who is watching how others use sideline time to continue their trading day.
It is like how jet pilots use propulsion surges to to go places and do things in the flight line. They can rightly afford to let nature take its course.
I'm glad increasenow is not going to use the DOM for now; my sense of relief comes from the fact he does not understand it and recognizes he must stay way from it. But, on the other hand, it was sad to see how a closed mind operates.
Since we trade very differently we use the same information to achieve different trading goals. Neither of us have a "My way or the highway" attitude.
I feel that being in the market all of the time has advantages; the being "pushed" part is a very important thing. we see the "push" differently because we have a different offset from the present for our monitoring and, in particular, our anticipation.
I focus only on making turns at end points of price moves. I do not see the MM and his actions as part of my anticipation. This is because I arrive at the end point of a price turn by having been in the market all the way from the last turn.
During these times, you and those whose strategies you associate with have made exitss, and have enjoyed the sidelines for a period of time whereby price come to a zone of value that lets them operate relative to their last success when leaving the market.
the scenery of the trader doing entries and exits is a land of contrasts since the view changes so dramatically by viewing from outside then viewing from inside. This being done over and over during the day, can contribute to the increasnow mentality of learners. It is a definite hazzard for entry/exit traders.
The DOM looks very different to a MM than it does to an entry/exit trader, I'm sure. I believe it is a very short term view and is exquisitly configured for making very small profits like a reel type mower going down a strip of lawn. He is defintely not mowing to produce a putting green behind his travels.
One of my recurring dreams used at the Jung Institute as a proto type (late 60's) dealt with the mind's ability to recognize hazards and navigate accordingly. Surprizingly, the vehicle (ever present in most dreams) was the "solution" largely.
DOM serves many styles of trading as the vehicle.
The essential ingredient that the DOM represents is the picture of the very near term future as an offset "before" the PRESENT, in which all trading takes place.
For one, I am eternally grateful to all of those who "telegraph" their intentions to us all in advance. Equally, I am eternally grateful for their intention to never give up the tick.
The triad of giving up the tick, always being in the market to front run everyone, and only doing market reversals, is like a dream come true. This combo vehicle allows one to float during RTH's and just supervise the flow of what the market offers into personal hoppers for capital. We all know of the money velocity (points/minute/contract) that this offering represents.
Seeing the jango of the enter/exit strategies where the position/sideline alternating ping pong prevails is almost the difference between mowing a scalping path on one hand and leaving a sheared green where everything has been collected over an entire playing area that it is possible to collect in a basket built for the purpose.
Thanks for your views from your perspective. I see it differently and monitor, process and record it accordingly.
Quote from buzz:
Look at Cumulative depth volume over the last few ES points!. Whenever one side of the market is larger, that is where you want to place your trade. Example, if there is large orders on the offer, you want to buy, if there are large bids, you want to sell Basically do the opposite of what others are looking at
Buzz
Buzz, you are correct. How did you know that ?
FS