Continue reading...What is order flow trading? In order to define order flow trading one would first need to delineate exactly the type of trading one is discussing. There is quite a bit of dialogue about order flow trading and misperceptions abound as to the most efficacious manner in which to use this trading method.
Some describe order flow trading as directional trading, i.e., you are betting that prices will either move up or down. If you believe a currency pair will go up, you will execute a buy order, going long. If you believe a currency pair will fall, you can sell it, shorting the trade.
Order Flow-Transaction Flow Order flow can also be referred to as transaction flow. Transaction flow takes place when someone believes the price of a security will move and then executes an order in the market. The individual can do this in two ways. He can take an aggressive approach by executing a market order and paying the spread. Or he can enter a limit order or stop order specifying that the...
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