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In comparison to other trading disciplines, Order Flow trading strategies does not contain that many trading strategies you can use. The explanation why, is because there is no proper order book available which you can use to see when buy and sell orders are entering the market in real time. The strategies I鈥檝e picked for this critique aren鈥檛 full order flow trading systems Aaron Ramsey Arsenal Jersey , so you don鈥檛 have to worry about changing your current trading strategy in order to trade them, you can just use them as additional setups to watch out for when your Market Profile.
Let鈥檚 move to defining core strategies.
When you have an idea what you want to use as core strategy Auction Market Theory, ask yourself:
What is the idea behind the strategy? What are the strategy鈥檚 strengths and weaknesses? What factors are giving my strategy an periphery?
I鈥檓 using the stop hunt tactic myself, so I鈥檒l answer the questions in the way I perceive it:
What is the idea behind the strategy?
Large traders cannot simply accrue or distribute positions whenever they wish to do so, because they would suffer from slippage. Slippage can have a great blow on your PL if you are one of the big players in the market.
What are the strategystrengths and weaknesses?
Strengths: Scheme of large traders behind it Yaya Sanogo Jersey , clear sentiment gives us the support of other participants, clear profit target.
Weaknesses: Entry point can be somewhat hard to resolve, another reason why we should focus on strong sentiment, so that we have the support of 鈥渢he flow鈥?
What factors are giving my strategy an edge?
I only trade when sentiment is clear. I look for the market to cause buy stops during positive sentiment and when sentiment is negative, I target sell stops. If response is positive and price action starts to move accordingly Wojciech Szczesny Jersey , other participants will start to join the move.