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You need to spend a lot of time watching the market to get the answers for your
questions. You must pay twice your effort for that.
The total understanding of the market is a HUGE project that I think no beginner can
"learn" all the thing at the same time, so my suggestion for you is that you must learn
them slowly, one by one.
You cannot eat 100 pizzas in one day, but you can eat that amount in one year or a few years if needed.
My answers to your questions: (you need to find them yourself in order to be useful for yourself)
1. Reaction:
What is the reaction of a girl you first meet and you say hello to her? She may smile at
you or she may slap on your face. What is the reaction you want to see?
Now when price go up to a resistance level, and then Big Trades come in, and what
reaction you can then see? The Tape/price slow down and pull-back a few points or the
price just stop for a second and you see on the Tape still many buyers coming in, and
price still continue up? If I want to consider short at this level, sure I want to see
some kind of pull-back to confirm that the market/demand is not too strong to consider
short.
2. S/R levels:
All Hi,Lo,Close,Pivots PP R1 S1,etc, and whole numbers like 100, intraday high low etc
are S/R levels. Too many to consider for beginner, so Bloom suggest us at the beginning
only consider previous days' Hi Lo Close.
3. Quality of how orders get filled:
When you watch closely on the ES, sometime you can see a price tick very difficult to
take out... many attempt to "eat" this tick, but just cannot....
But on the other time, you see big limit orders sit on the ask, but just get eat like a
cake....
I don't know how to define "Quality of how orders get filled" but when you watch ES
closely and longer you can just see them.... it is not as easy as saying like 35% or 64%
Quality, but you can have a tell about the different.
4. Who is stronger:
When price go up to a resistance level, speed is slow, orders on the Tape are all small
trades, then at the resistance level, a lot of Big trades show up fast and push price
lower, you tell me who is stronger?
Now, if price go up to the same resistance level, speed is fast, with big trades showing
continuously and never stop, and the price never pull back or stop, you tell me who is
stronger?
The two cases above are extreme case, there are many cases not easy to tell for beginner
like you and me..... the only thing I can do right now is just don't trade and skip this
level... haha but sometime I still overtrade, and "guess" who is stronger! I need to get
rid of those overtrade to become consistent.
5. Simply supply were satisfied:
Don't think it too complicated, the market is a big market. The big trader supply of
10000 contracts for sell, but if there are still over 10000 small retail traders with 1
or 2 contracts need to buy ( maybe they shorts previous days, and today see no hope price will
drop back, so they need to buy to cover), then the 10000 contracts for sell will be eat up.
6. Remember what price were this seller. It would be support level than he ll begin to go
out of short:
I think Bloom means: It would be support level that he'll begin to get out of his short
positions.
Let say, if you have short at a level with 10000 contracts, then price just go up and
you are now lossing.... what will you do later if price luckily come back to your entry
level? Will you buy to cover your short position?
It is the basic operation of S/R levels.
I am still a learner, so don't just blindly believe what I say, find the answers out
yourself so that you can believe in yourself... it is what you need to trade.
Let me Thanks Bloom again here, for he guide me think more about the detail of the
market. And when you can "see" what is really happening, there is much lesser fear inside my
head.
This is by far the most elaborate and excellent explanation in this entire thread. This will not only help me to get clearer insights, but also to hundreds of others who will read this thread in future. Thanks a lot!!
But please note that once I digest what you have written here, I may again give you trouble with questions that goes deeper and finer.
yeah. there is a little problem with all of these.
once u start to see the things you will find out more things to explore and the more information you can process the wider is your decision tree.. given the speed, you have to be a) sportsman, pilot, surgeon b) able to teach yourself (which is unique - all the above have trainer, coach, teacher to learn their skills)....
means talented tape reader / scalper is very unique combination. also you have to be profitable quick because without profit skills get suppressed by negative emotions...
also you need a lot of other trading skills to manage those microtrades.
also you need money. all those 500 margin accounts never works in the way a noob expects.
all in all... this is not for an average computer geek. this is almost impossible.
especially considering that 99% of noobs attracted to scalping because it seems like a safe way to trade - in and out. got few ticks here and there and then scale it up to 10 cars and voila. champagne with black caviar....
1. what you talking about the colour of the tape, do you just put
red for sellers and green for buyers (nothing els)
or plain all togetha (just in the pic i can see just red/green) kinda anwsered my own question but just want to be sure
2. how are you finding jigsawtrading T&S has this helped you alot?
i meet this guy the other day, he is also a tape reader and no lie all he trades off is T&S !!NO CHART`S!! and his tape is plain for buyers and sellers!!!
and he seem to be doing really well, i seen a few of his trades and he says he can just feel the market and how its going to react....what you think
i got my own little system going no...used to have 10000 charts
now i got 2 charts, 1 i hide which provides me with auto levels on a higher time frame and the second a fast tiome frame to project these levels for mee to see
basically there major doubble top/bottoms and major swing levels in the markets
i have been watching this a long time now and they play a big part, they either hold to the tick or break thought them...this is were i read tape to deciede wether to take trades or not
i dont look at the market depth on the DOM at all tho...do you guys really think this help`s i kinda see it as a distraction for me..i would rather see pure price action in real time!
i also have a pace of tape indicator which i got from www.schooloftrade.com dunno weather to even use it any more tho as we can just feel the sleed (another distraction) just use it as i paid $3,000 for the course ages ago when i 1st started trading
one thing JJ (from SOT) did teeach me is to bracket price on the tape and wait for a break out of that bracketed price with speed and big buyers
what do you think of this technique?
glad to participate in this thread and will contribute with vids and screen shoots when i get the time as at the moment im holding out a full time job, untill i can consisently make money trading
i guess i'll try to help you since I'm reading the thread right now.
first, nice to meet you. its always great to chat with another non-chart trader.
basically bloom trades without considering whether the trade executed at the bid or ask. he calls it a monochrome tape. essentially he is using some market profile concepts and some technical analysis concepts to take entries using the "monochrome strip" let me explain.
when bloom says he likes to see larger and larger trades as his position moves in his favor, he is basically reiterating a market profile concept. that concept is that price will find a range that allows the most volume to be transacted between buyers and sellers. essentially he is looking for low volume price rejection, then he is looking for large buyers to step up and then bloom will take the trade anticipating that large buyers will move price back into an area that everyone agree's on. he doesn't look at bid/ask on the tape, he looks for price rejection/acceptance based on the size of trades at a certain price level.
i think its an interesting approach but it doesn't take some things into consideration. for example you cannot use this strategy during low volume/ low liquidity situations. the reason is that the market can move on very low volume. lets say for example that a long is liquidating and he doesn't want or can't sell past the low of his box. he then lifts a couple ticks and soon realizes that he doesn't have any sellers above him. after a while he realizes he can sell the market higher using a little creativity simply because there are no other sellers. likewise there may not be much buying either, or he may be the buyer. the point is, the market can move very far without ever seeing any meaningful size transact and therefore may give the wrong signal on the tape using blooms strategy. in my opinion, on the es, this is best employed during the first 1-2 hours and the last hour.
i think its cool that you bracket the tape and use it like a breakout system. the guy who invented that (at least i think) is the owner of traderlaboratory(dot)com he has videos over there if you ever want to get more info on that strategy. i can't seem to remember his name, i think its james, i haven't been over there in like four years.
also if you ever need a different pace of tape indicator, this guy publish an open source version. tradewiththeflow(dot)com
he also has some video's explaining how to use it. its a pretty interesting concept but i have to admit i haven't used it myself
Actually no, it's quite fesible to trade off the tape and/or DOM.
Trading just off the Tape is easier on a market like the CL/YM, basically anything thinner will be easier to see the price stalls.
For ES/Treasuries, it's a harder task, there's more info to absorb, so it helps (in my opinion) to use it alongside the charts and some knowledge of market structure. Either that or use the Tape with the DOM so you have an idea about what is being hit.
If you bring the DOM into the equation. Well - plenty of people trade of X-Trader DOM without worrying about charts too much.
The whole reliance on charts for intraday trading comes from the educators/trading forums/indicator salesmen/trading books. I've yet to meet someone in real life that is making consistent money from just trading off charts - with or without indicators.
so BLOOM basically trying to track the big sharks eating the market......as you said you need to trade in hi vol maket conditions hmmmm
i have read alot in this thread about DOM depth and orders waiting to be filled and how traders try trick people watching this, we only have one set of eyes...is this information valuable enought to watch? in my eyes executed action on the T&S is the only think worth watching...i am wrong?
i personally do not keep a time and sales screen open. i trade out of the order book exclusively and i keep a 15 minute chart of today's and yesterday's action. when trading i consider certain aspects of the outside market relative to the time of day. i keep track of the quality of buying and selling. i watch the behavior of the spread as we move up and down with respect to the current liquidity situation. basically, for me, tape reading means using the order book to consider the outside market, inside market and to develop a type of profile for the participants that are currently working the market. once i have a basic idea of that i use the book to show me low risk entries with clearly defined definitions of "wrong" and "right" so that i can properly manage my risk. if i'm gone for lunch and lose track of things, i glance at the 2 day 15 minute chart to get a sense of what has happened. I also use the chart to identify yesterdays HLC, overnight HL and current high low.
I wish you all the best with with your trading. Enjoy the weekend.
This whole week I have been thinking about "good quality fill" and I have developed some queries :
1. The phenomenon of "good quality fill" is something to watch in the charts only? Or there can be some confirmation in the T&S too that can say whether quality of filling that is going on is good or bad?
2. What are the different reasons for price rejection?
3. Is Good filling opposite of Price rejection?
4. If the price tends to "stick" to the bid, is it an indication that the bid is getting a good quality fill?
5. There are many times when the price keeps on bouncing up and down over a bid. Does that mean that (a)quality of fill is poor and (2) the seller is more likely small traders? Shall we avoid analyzing such situations? If not, then how to analyze this situation and how to take advantage of that?
6. If the price "sticks" to the bid (good filling of the bid). the following can happen:
a.The bid gets broken. Will we short here ?
b.The bid starts to get rejected. Will we buy here ?
7. In our country, we don't have access to DOM or L2 data. So is it ok to guess the places where a big bid (or offer) is present from the charts only? Like if price is constantly hitting a level but can't break it, does that indicates that a big bid/offer is residing at that level?
8. For an uptrend, will it be correct to say that subsequent ask levels (each level higher than the one before it) receives good quality fills from the market buyer? AND, as long as this good filling continues, the uptrend will continue else stop?
9. Please look into the image attached and please point out the mistakes in it .
Thanks for reading my question paper. lol
Thanks in advance to them who may want to reply them.
Apologies to others who feel bored after reading them
