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MIT vs Limit Orders

  #14 (permalink)

Trading Experience: Intermediate
Platform: TOS, NinjaTrader
Favorite Futures: Emini ES
Posts: 24 since Jan 2017
Thanks: 29 given, 18 received

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Limit and Market orders can be considered our employees or tools. Knowing when to use a certain tool for the job is the key, or for that matter assigning a task to the correct employee to obtain the desired result.

Assessing the current condition of the market just before you execute is paramount in the decision of which tool to use. This takes some level of skill and other tools to acquire this information.

Helpful in this regard I feel are "foot print" type charts, time and sales, DOM... Jigsaw tools work very well for this.

One needs to discern if the limit orders are getting hit to the point that they completely run out and the price moves to the next level/price, or if the limits are being added to and replenished or pulled a lot or if the book is so super deep at this moment in time and the trade at just an average pace that fills are unlikely....

Then very closely related to this of course, because limits only pair with markets, we need to analyze how the market orders are being used as the inherently aggressive action.

Then from these observations we can have a better chance of getting filled... You have now put the odds more in your favor for your fills by this analysis but it's still < 100%.


Thanks Ron, that is a great way to look at it! I have been studying the lessons on the order flow at Jigsaw (which are amazing!) and I started to see when it would be more advantages to use a limit or a market order based on the order flow. It's going to take a lot of practice, but with hard work I think I can learn when to use each type based on what the order flow is telling me. Great answer! Thank you!

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