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ES intraday volatility recently

  #14 (permalink)

Trading Experience: Intermediate
Platform: NinjaTrader
Favorite Futures: Es
Posts: 170 since Nov 2012
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choke35 View Post
In contrast to noise traders OTF traders regularly don't trade without reason.
Minor/mostly irrelevant OTF reasons are technical, e.g. are pivotal points of
supply and demand which can be spotted in the charts. Most of the time the
minor reasons only get relevant when herd instinct leads to sharp rallies or drops
and thereby creates a news of its own.

Stronger OTF reasons normally stem from fundamental news which influence
valuation expectations of large portfolios, e.g. NFPs, FED, ECB. For individual
stocks you can add earnings news to that list.

The less fundamental news you have (i.e. the higher the level of pure noise)
the more market volatility normally shrinks and normally esp OTF volume with it.
So as long as the VIX is that low it's one confirmation for OTF that nothing
is going on and thus no reason for trades.

Thank you. That was really clear. I appreciate the extended explanation!!

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