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Order Book Bulk Limit Orders


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Order Book Bulk Limit Orders

  #1 (permalink)
offthewalltw
London, UK
 
Posts: 1 since Feb 2022
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I have an ignorant question regarding the order book. Have seen that frequently before the price moves up there is a bulk of limit orders at the ask price. The price might temporarily move down slightly before regaining upside momentum. Is this evidence of 'liquidity hunting' and traders are being stopped out at key prices? or have I got it completely wrong.

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  #2 (permalink)
opi5981
Beijing,China
 
Posts: 22 since Sep 2021
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I think a large number of sell orders appearing on the order book creates resistance for the market to rise, and at the same time triggers algorithmic trading to preempt the big sell orders, causing short-term price drops when the market cannot break through the large orders, such as today's ES, in the pre-market trading session, there is a large iceberg order at 4335, and every time the market rises, it hits the iceberg and then returns. Also, I don't understand what you're talking about liquidity hunting. I know more about stop hunting, luckily I observed the DOM during today's stop hunting and kept a screenshot. Stop-loss hunting occurs when the price breaks a well-known resistance level. There are many strategies that use iceberg orders or large orders as conditions to trigger trades, such as preempting large orders or chasing orders after breaking through large orders. .
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Last Updated on February 23, 2022


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