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Charting VS orderflow

  #9 (permalink)

Milwaukee, WI
Posts: 88 since Jan 2014
Thanks: 4 given, 43 received

Grantx View Post
Yeah, your explanation makes sense. Are you making money with that knowledge?
How do you identify and deal with all the ladder noise and misdirection?

It helps me understand things and certainly helps me to loose less! It is not a complete system - just a way of identifying what is going on. I think you use it as the basis of system. Honestly, I don't look at the noise in the ladder other than to see if there are changes in the average amount of orders in a range of prices. The problem today is that bids and asks can be pulled instantly by algorithms. Every once and a while I do see a big standing order at one price and it often happens that if price gets going in that direction it will almost certainly get to that price. It seems that one must integrate price action, bid and ask volume (delta volume) action, tape reading, ladder action (minimally), volume at price, and support and resistance to get a reasonably complete picture of what is going on. I wish the ladder could indicate intent; but when you think of it, how could it? If it did, traders would be giving away the store. A major goal for a big trader is to fool you into making a bad trade so that he can take your money. Thus, what is in the ladder must be, to a significant extent, deception. Anyway that is how I view it and it seems to help me loose less!

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