Sudden accelerations on Dax

The Snip€r

Junior member
23 0
Lets take an example.

Today at 05:03 am easter time, Dax 30 had a kind of rush/acceleration from 12370 to 12396 points during 5mn.

I 've been taken by surprise (i trade contrarian prolly too often...) and would like to know if there was a way to predict this sudden acceleration please ?
 

NVP

Legendary member
37,088 1,916
no.......apart from more obvious time bars ....or time points
 

trendie

Legendary member
6,305 1,031
I don't think it's possible.
You could deconstruct your question into:
can you predict sudden accelerations?
then, can you predict slow moves,
then, can you predict any future moves!
If you see what I mean.

All you can do is monitor moments when economic news comes out, and anticipate that sometimes markets may move strongly.
If you believe all news is factored into price, then outlier news events can impact prices.
I think you just have to ascertain the landscape. For example, prices moves in the first hours of sessions opening, economic news events, (conversely, when prices are likely to meander around, when markets are closed) etc. and trade with an eye to that.

I know that doesn't help.

Summary: no.

PS: people who have access to order flow might disagree!! :)
 

The Snip€r

Junior member
23 0
Thanks for your answers guys !

May i ask you another question on this topic ?

- What is the most common reason for an acceleration ? ... A "big hand" has made a huge trade ? Or many small traders have made small trades at the same time please ?
 

Bloodhound

Senior member
3,467 1,318
Thanks for your answers guys !

May i ask you another question on this topic ?

- What is the most common reason for an acceleration ? ... A "big hand" has made a huge trade ? Or many small traders have made small trades at the same time please ?
Can you post a recent chart example of what you mean?
 

The Snip€r

Junior member
23 0
Here is the example i describe in the beginning of this post.

Last thursday at 05:03 am easter time, Dax 30 had a kind of rush/acceleration from 12370 to 12396 points during 5mn.

If you was shorting during this acceleration you was in bad shape like i was ^^

 

wallstreetwarrior87

Experienced member
1,884 354
Thanks for your answers guys !

May i ask you another question on this topic ?

- What is the most common reason for an acceleration ? ... A "big hand" has made a huge trade ? Or many small traders have made small trades at the same time please ?
Great question, but you will only really get an affirmative answer from those that trade order flow. The answer is YES you can definitely be in a position to anticipate the mentioned move in advance, based on the information you have available. But you need volume for this play.

Those that say there is no way to know, should restructure their answer to "They personally dont know how to ......blah blah" .

This is not a snipe at others, nor is it a criticism, its just a nudge to get people to remove any type of ego, you know just a bit of self honesty. Volume tells you that there are (a few) that know whats going on, as price is marked up into the area which then creates the acceleration as you called it, but in fact it is late short sellers being forced to liquidate their positions that causes it. If no one knew, then no one would mark price up on the cheap. Think about it - why would they do that if there was no (high probability) outcome for them to do so. Makes no sense at all. BUT we are led to believe that the markets are not designed to make sense, and many times, it is hard to decipher what is going on, so simply stay out. But this is not the case all the time, and this is when a day trader needs to be alert, as there are plenty of times in a session when there is an outcome that is "highly" predictable.

Back to chart -

So to the chart in question, attached is your chart in a different format; you can see we are making new lows on the day, decent volume coming in on A and B, so cool, we have sellers coming in, could even say they are in control. Then look what happens - we drift back up in a controlled manner, with volume drying up, this be telling us that sellers are backing off, not because of willingness, as why would they, this is a strong down move, making new lows on the day! But because they are running out of ammo. We then see a light test in the square (C). Great, so what? Well, doh, if traders are trapped short, and we have light liquidity, then they are at the MERCY of the smart players who know they can buy at market into the area where shorts have stops, thus being able to guarantee an exit on their endeavour. So in advance the question is......... What type of acceleration would you expect to see - all in advance of course.

So back to those that replied its not possible - do you really believe that????

Its ok for others to say this cant be done, or cant be known, and thats cool, but some can, and do take these trades on a regular basis, and when you spot them, you will win pretty much every time, as it is a law of supply and demand on the most rawest piece of data available - ie the here and now! Here and now is what day trading is about, what is currently going on, who is trapped, where will they dump etc?

News has its place, and we are not talking here about knowing in advance which way we go ahead of data releases. This is TOTALLY different. Those that can see it - want to see it. Those that cant - well, they will never believe. No worries each to their own.

Back in Feb/March 2018 I traded fast moves (rarely longer than 5 mins in a trade) and posted some blotters also - off my head it was about 88% SR (8/10 trades per hour, roughly 80 trades) off a 5 second chart LOL, now there is no way I could do this without having a grasp on where to play, or should I say, where the smart money plays. I did this to show a mate of mine what could be done in a few hours a day in a faster market. This is not to show anything other than what is possible, not to showboat or anything like that, it is solely to show those interested in this style, what maybe possible by anticipation based on context.

The only intention of this post is to put another viewpoint across, maybe light the fuse??? Come to the darkside Luke :LOL::LOL::LOL::LOL:
 

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Bloodhound

Senior member
3,467 1,318
I don't think I can add much to what Wallstreet has already said and I sincerely hope it does 'light the fuse' for you as their post is a goldmine of information for the few who are prepared to open their mind to it. As they say, a proper understanding of price action / orderflow means that a trader can, and will, find lots of occasions when what price is going to do next is 'highly predictable'. The only thing I would disagree with is the need for volume information but that is, I believe, a personal thing and I certainly wouldn't want my disagreement about it to detract from everything else WS has written. In a nutshell what you were seeing there was sellers being trapped on the wrong side of the market because they were selling into an area where 'smart' traders were going to be buying (see my first chart). The second chart shows a very similar situation occurring on Friday albeit in the opposite direction. Would I have taken those 2 trades? 100% definitely yes. They were both a type of trade I take every single day. I particularly like the second one which is about as picture perfect as they come and also includes another price action / orderflow scenario called compression.

The fact that you asked the question you did leads me to believe that you are wanting to see things in the right way. Something that very few traders ever will. If the fuse has been lit, drop me a line and I'd be happy to point you in the direction of some free resources prepared by the guy who taught me.

20190711daxt1a.png
20190712daxt1a.png
 

The Snip€r

Junior member
23 0
Fantastic answer from you both Wallstreetwarrior87 and Bloodhound !

Thanks a lot for your kindness and the time you gave to me i really appreciate ( please forgive my mediocre english for this present message and/or any futures chats)

May i ask you some simple, straight and VERY CANDID questions please ? (please answer in few words i do not ask you unpleasant effort to answer me ;)

@ Wallstreetwarrior87 :

1/ You say a "light test in the square", are we agree you use the word "test" to describe only a fail for the seller from an observer point of view right ? I mean there is no such thing that traders do like putting money short thus buying contracts just to test the water and losing money if they are wrong ? ( iceberg orders on the order book are for real okay but is decoy trades are for real as well ?)

2/ You say ; "if traders are trapped short, and we have light liquidity, then they are at the MERCY of the smart players who know they can buy at market into the area where shorts have stops, thus being able to guarantee an exit on their endeavour.

- Why do you think those traders who are trapped short would inevitably have stops very cloth from that area please ? And not 20 or even 50 points farther ?

3/ What is the format of your chart ? 3 minutes right ?

4/ You say "88% SR" what do you mean by SR ? success rate ?

@Bloohound

Warning very straight and naive question ahead;

5/ What tells you in your both graph that each time break out will fail please ? ( for example on your second graph it is a 3rd "test" so 3rd test is always pretty risky no ?)

6/ Order flow you mean dom or level 2, the order book right ?

Finally thanks a lot bloodhound i would be glad to see your free material as i am a genuine "seeker";)


To both of you;

7/ Do you guys trade with order flow or only with price action or both ?

8/ Are you both professionals traders please ?

Sorry ridiculous, too many questions... ^^
 
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Bloodhound

Senior member
3,467 1,318
Questions are always good! OK, I'll try and answer the ones you have asked me.

5. I'm going to PM you some info on this.
6. No. There is no need to have access to anything like that. All the information required to trade the way I do is based on the chart. In fact, if I were to have traded those Dax moves, the only reason I would have looked at anything other than that M15 chart would have been to see if I could get a tighter stop loss.
7. I would describe myself as a price action trader but that encompasses a knowledge of a number of basic concepts such as order flow, price rejection and consumption, momentum, supply and demand, plus a few others.
8. This is an interesting question to answer. If you mean do I trade full time for a living then the answer is yes. If you mean do I manage a fund then the answer is no. However the much more important question is do I think / trade like a professional or like a retail / amateur trader? I won't go into detail as to why the answer to that question is yes save to say that it is :)
 

wallstreetwarrior87

Experienced member
1,884 354
Fantastic answer from you both Wallstreetwarrior87 and Bloodhound !

Thanks a lot for your kindness and the time you gave to me i really appreciate ( please forgive my mediocre english for this present message and/or any futures chats)

May i ask you some simple, straight and VERY CANDID questions please ? (please answer in few words i do not ask you unpleasant effort to answer me ;)

@ Wallstreetwarrior87 :

1/ You say a "light test in the square", are we agree you use the word "test" to describe only a fail for the seller from an observer point of view right ? I mean there is no such thing that traders do like putting money short thus buying contracts just to test the water and losing money if they are wrong ? ( iceberg orders on the order book are for real okay but is decoy trades are for real as well ?)

2/ You say ; "if traders are trapped short, and we have light liquidity, then they are at the MERCY of the smart players who know they can buy at market into the area where shorts have stops, thus being able to guarantee an exit on their endeavour.

- Why do you think those traders who are trapped short would inevitably have stops very cloth from that area please ? And not 20 or even 50 points farther ?

3/ What is the format of your chart ? 3 minutes right ?

4/ You say "88% SR" what do you mean by SR ? success rate ?



To both of you;

7/ Do you guys trade with order flow or only with price action or both ?

8/ Are you both professionals traders please ?

Sorry ridiculous, too many questions... ^^
I must say you do seem pretty clued up! Your answers to your own questions are very observant, and if you keep going forward in this manner, you will be on the right track in no time (maybe you already are???;);))

1. Yes I use the term "test" in relation to the sellers. You of course, are observing it from the point of view of seeing how strong it is (as you know why you are doing this), but the sellers are unaware that it "could" be a test, as they are only thinking in terms of a continuation to the downside. You are gauging the strength/weakness of it. This has nothing to do with buying contracts to test the sentiment. The buying will ultimately happen by those that are aware of the situation in the sentiment, but it will be done with a motive, and not to fathom out what the sentiment is. Hope this makes sense?

2. Day traders tend to move stops down each time an apparent lower high is in place - hence traders at A and B will have quickly popped in their protective stops as point C was forming. Its the way most teach this, books, courses etc. Volume can confirm if you need more evidence? So, its not really to do with a set amount of points, its relative to the condition of the price action.

3. Yes this was a 3 min - I used this as I thought it was the best time frame to illustrate the example.

4. Yep winning trades. The risk/reward on most of these was 1 to 1 - But I move stops in fast, so not all losers will be for the full amount of risk.

7. I personally class price action and order flow as the same. So use current price action to help me work out future order flow (again hope this makes sense?). Don't use DOM now, used it in the past, but switched to just pure volume. IMHO its more important to concern your self with context, rather than looking for games in the book. Remember, even the clever dicks can get steam rolled when they play games in the wrong location!

8. Was full time, now part time. I dont set myself any work shits as such. If I want to trade I will do, only if I can see something worthwhile. I fund a property business (well the Bro in law does most the work lol) and this keeps me out and about. But I do like to get at least 2 sessions a week in if I can. If you want more, just trade larger size (as long as it doesnt affect your edge). That was my point to my friend, an hour a day is enough if you ONLY play the right plays. If not, it will simply be a coin toss. Be there at the right times, remember we need movement as day traders.

I did try a bit more longer term stuff, but the results were no where near as good. Some of our colleagues can confirm im about 50/50 in the S&P Comp we take take part in, so no medals there lol. But its a bit of fun, and if you were to really put the money on the line, you would probably only play 2 or 3 times per quarter. But I must say there are some good guys in the comp, week in week out, good calls, so kudos to them and how they do it!

G/L with all of this, im sure you will be up to speed in no time!
 

The Snip€r

Junior member
23 0
@ Bloodhound

Professional i mean make a living from it no more ;)

So what do you mean by order flow if you are not referring to this please ? (https://ibb.co/Fsh85sx)

Could you briefly explain what do you mean by the concept of consumption please ?

Thanks a lot !


@ wallstreet

Thanks for your compliment this is so refreshing to speak to gentle and warm persons !

Yes i agree entirely 1hour a day is enough with a sizing which fits your appetence...

Now i do not consider myself as a pure day trader (anyway i am no more than a beginner) as my background and personality is more oriented with what i would call "agressive micro-scalping" for some reasons...

Would be happy to tell you more briefly by PM on my personal context and the risk reward topic which is my main concern lately if you are okay.


Thanks all for your kindness here, a real pleasure to be a beginner not being confine to a stereotyped beginner treatment :)
 

wallstreetwarrior87

Experienced member
1,884 354
@ wallstreet

Thanks for your compliment this is so refreshing to speak to gentle and warm persons !

Yes i agree entirely 1hour a day is enough with a sizing which fits your appetence...

Now i do not consider myself as a pure day trader (anyway i am no more than a beginner) as my background and personality is more oriented with what i would call "agressive micro-scalping" for some reasons...

Would be happy to tell you more briefly by PM on my personal context and the risk reward topic which is my main concern lately if you are okay.


Thanks all for your kindness here, a real pleasure to be a beginner not being confine to a stereotyped beginner treatment :)
Micro scalping - I like it! Sure, just PM anything across, and ill keep an eye out.

Thanks
 

Bloodhound

Senior member
3,467 1,318
At this rate I might have to start trading the Dax!

Not an 'A' grade setup for me but I know others would love this as a trap. Dumb money suckered long straight into an area where smart money is likely to sell. Trap forms, dumb money stops below the breakout level get triggered and boom.

20190715daxt1a.png
20190715daxt1b.png
 

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