FOREX PRO Weekly July 30 - August 03, 2012

i've got a question for sive or anyone who already trades with a prime broker.

it's regarding the difference between the data feed retail traders see and what the brokers see, incl the order book for those whose broker provides that.

i just got out of a netmeeting with a rep from FX Alliance (fxall.com) and he demoed the platform for me. those of you who are familiar with currenex, well it looks kinda similar. anyway, you have your bid/offer buttons, pair names and so on. what's interesting is that you see the liquidity pool and which bank is on the bid/offer and for how much.

also, there is another order book that is aggregated through lava and that one is anonymous, meaning there is no granular info as to who is on the bid/offer.

now, and here comes the question, the rep was showing me a price and ok... let me explain this better: for ex, say we have e/u now at 2210/2213. and in the order book you see all the orders above and below that price and size as well. say, you have GS on the offer at 2195, which is below market in this example. the rep said something like if you want to buy at 2195, that is, take GS's offer, then you can and you actually would now have a open buy order with actual entry at 2195 EVEN THOUGH market is at 2210/2213!

now is that truly possible? it sounded as if the guy was implying that if a bank wants to deal at a slightly different price level from the current market price, they could if you are willing to match that price. did i understand this properly or did the guy mispeak?

because if that is true, then, assuming you have the necessary size to play at that level, then player could strike deals at a better price and then immediately turn around for a guaranteed profit. somehow it feels like this doesn't make sense.

sive, guys, any ideas?
 
i've got a question for sive or anyone who already trades with a prime broker.

it's regarding the difference between the data feed retail traders see and what the brokers see, incl the order book for those whose broker provides that.

i just got out of a netmeeting with a rep from FX Alliance (fxall.com) and he demoed the platform for me. those of you who are familiar with currenex, well it looks kinda similar. anyway, you have your bid/offer buttons, pair names and so on. what's interesting is that you see the liquidity pool and which bank is on the bid/offer and for how much.

also, there is another order book that is aggregated through lava and that one is anonymous, meaning there is no granular info as to who is on the bid/offer.

now, and here comes the question, the rep was showing me a price and ok... let me explain this better: for ex, say we have e/u now at 2210/2213. and in the order book you see all the orders above and below that price and size as well. say, you have GS on the offer at 2195, which is below market in this example. the rep said something like if you want to buy at 2195, that is, take GS's offer, then you can and you actually would now have a open buy order with actual entry at 2195 EVEN THOUGH market is at 2210/2213!

now is that truly possible? it sounded as if the guy was implying that if a bank wants to deal at a slightly different price level from the current market price, they could if you are willing to match that price. did i understand this properly or did the guy mispeak?

because if that is true, then, assuming you have the necessary size to play at that level, then player could strike deals at a better price and then immediately turn around for a guaranteed profit. somehow it feels like this doesn't make sense.

sive, guys, any ideas?

Hm,
it is curious, Triantus. At first glance, it looks like their software has a real problem, because it has to automatically match best bid-offer quotes. So, if GS offer at 1.2195, hence their bid should be also somewhere below it - then it has to replace 2210/2213 quote and these quotes should move at worse places in queue.
Second, may be some ECN allows to make direct trades, I do not know exactly. If, for instance, some counterparty place offer or bid that is suitable for you and you agree with him previously to hit this offer. So he places offer especially for you and you hit it.
That is very often on exchange bond market or shares. Mostly for booking statement, since this allows to change final close price at illiquid bonds and price them higher in statement.
But on Forex... I do not know.
 
Hey Sive,

Hope all has been well with you.

Just got a quick question..

How come on your H4 chart I see 100% fib for the AB=CD pattern but there are no reaction points there? Why would there be 100% fib if there isnt anything there? Usually you get the confluence areas by finding the reaction points and draw fibonacci there and so on but for your H4 chart, I do not see anything that you are drawing to. There are no candles there so I am just kind of confused.

I just want to know how you got that 100% fib target because there isn't any candles there..

I hope you understand what I am asking.

Have a great week, Sive.

Cheers!
 
sive, if i may take this one...

beekay8, you are a little confused indeed. first, let's take a look at the H4 chart. sive drew 3 fib structures on it, of 2 different types.

type 1 is fib retracement.
type 2 is fib extension.

as you can see, for type 1, sive used reaction points 21172 and 2042.

as regards your question concerning the 100% level where indeed there is no candle at the time of drawing, that level belongs to type 2 structure, that is, it's an extension (into the future, as it were). another way of saying this is to point out that we have the AB leg and the BC leg, but the CD leg has not formed yet. the 100% fib extension level or OP as dinapoli calls it, is where we project a potential path for the market to follow. therefore, of course, we can't have a candle there since it is a projection ahead of time.

to summarize, there is nothing wrong with sive's chart.


How come on your H4 chart I see 100% fib for the AB=CD pattern but there are no reaction points there? Why would there be 100% fib if there isnt anything there? Usually you get the confluence areas by finding the reaction points and draw fibonacci there and so on but for your H4 chart, I do not see anything that you are drawing to. There are no candles there so I am just kind of confused.

I just want to know how you got that 100% fib target because there isn't any candles there..

I hope you understand what I am asking.

Have a great week, Sive.

Cheers!
 
craig's method is solid. and from initial disbelief, i came to realize he is the scalping god incarnate. ;-)

i started dropping my time frame and went back into what i call micro scalping and my yield so far is way better than before when i just waited for H1 or H4 to move 50 or a 100 pips as one linear move, not capturing any of the moves in between. so it's a different style from what sive teaches here.

it's like going from driving gently along the highway in an audi A4, to driving a freakin' bugatti veyron at 350+ kph on the same highway. meaning that, and of course that depends on your setup (his setup is very very nice--mine is more messy, hence more stress), you have got to pay careful attention. one moment of inattention and it will cost you, even more so if you go in with 10 lots when you really should only use 1, for example.

i don't care if you already know this, let me repeat it one more time as it is so important: try it only if you are 100% awake and capable of NO hesitation and NO overthinking. if you overthink, hesitate, or just feel drowsy DO NOT ATTEMPT IT. you need the same clarity of mind as when practicing high level martial arts.

ok enough said. good luck.

Minimax, Triantus shango< have you guys been following craig bryan? whats your opinion so far about his trading methd?
 
I have followed the link to join me (about Craig) and have been watching his charts and reading the messages in the speech bubble but have i missed where his website is or his thread is on FPA, for understanding his trading methods.
 
my understanding is that craig prefers to show rather than try to explain in writing. so there is no link on the FPA site and no craig site. all you need is go to join.me and observe. especially pay keen attention to where the up and down arrows appear on the different TFs. i would advise you to correlate that with your own charts using MACD (with dinapoli inputs) and DPO (not DRPO, but DPO) and 200/100/50/20 SMAs and 3x3 DMA (to catch dinapoli DRPO and B&B directional moves).

godspeed! ;)

I have followed the link to join me (about Craig) and have been atching his charts and reading the messages in the speech bubble but have i missed where his website is or his thread is on FPA, for understanding his trading methods.
 
Hi Triantus Shango,
What does DPO mean and how is it applied to trading.
my understanding is that craig prefers to show rather than try to explain in writing. so there is no link on the FPA site and no craig site. all you need is go to join.me and observe. especially pay keen attention to where the up and down arrows appear on the different TFs. i would advise you to correlate that with your own charts using MACD (with dinapoli inputs) and DPO (not DRPO, but DPO) and 200/100/50/20 SMAs and 3x3 DMA (to catch dinapoli DRPO and B&B directional moves).

godspeed! ;)
 
DPO = Detrended Price Oscillator

good for identifying OB/OS areas as it is not normalized like Stochastic, i.e. Stochastic can't go beyond 100 and below 0. dinapoli talks about it in his book. so sometimes you have OB/OS on Stoch when market is not really OB/OS yet--when the signal line crosses into the 2 horizontal lines at the top or bottom of the indicator window, that's when you know market is OB/OS.

go to http://stockcharts.com/school/doku....ool:technical_indicators:detrended_price_osci for more details.


Hi Triantus Shango,
What does DPO mean and how is it applied to trading.
 
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