Market movement of trade market!
There are legions of dedicated Market Profile users who are hopelessly dedicated to this market-driven information tool. Though I don't usually write about Market Profile (MP), for reasons I don't completely understand, MP is a great tool to understand the overall structure during the course of the trading day. To clarify, I am a scalper so I don't utilize MP in the longer term, but there are great applications using the trade marketplace for manufacturers if your trading horizon is longer than 15 minutes.
So who cares who is driving market movement and of what use is this knowledge?
As I mentioned earlier, I don't specifically initiate trades based on Market Profile, but use the profile to identify specific areas that potential e-mini trading may develop. Areas like value areas, developing value areas, auction actions and reactions, and bracketed markets are all very useful in alerting e-mini trading opportunities to traders. At this point you might wonder, if I don't use the system to identify specific trading opportunities, how do I integrate MP into my trading system?
Order flow, is the wild card in this equation. If I can determine specific areas, using the MP system, where trades are likely to develop, then order flow can pinpoint (in real time) the direction of free trade market area in these general areas where trades can be initiated with startling accuracy. Further, by using confirming real time indicators, like tape reading and analysis, in tandem with MP and order flow, you can initiate some extremely accurate trade set-ups.
Because of the complexity of understanding MP theory and applying it to your trading it is often glossed over as being too technical or time consuming for the retail e-mini trader. I can tell you that time spent understanding market structure, order flow, tape reading, and correlated markets are well spent and will greatly increase your trading accuracy. Is it tough stuff? Yep, it isn't exactly a walk down in the park when you embark on the task of integrating these systems together; but the rewards are manifold.
I am interested in education and technique, not spitting out trades that participants blindly initiate. It's no way to run a business, and your personal trading is a business. Taking blind trade calls is like owning an auto parts store and not knowing the function of a brake rotor or alternator. Like I said, it's no way to run a business.
So who cares who is driving market movement and of what use is this knowledge?
As I mentioned earlier, I don't specifically initiate trades based on Market Profile, but use the profile to identify specific areas that potential e-mini trading may develop. Areas like value areas, developing value areas, auction actions and reactions, and bracketed markets are all very useful in alerting e-mini trading opportunities to traders. At this point you might wonder, if I don't use the system to identify specific trading opportunities, how do I integrate MP into my trading system?
Order flow, is the wild card in this equation. If I can determine specific areas, using the MP system, where trades are likely to develop, then order flow can pinpoint (in real time) the direction of free trade market area in these general areas where trades can be initiated with startling accuracy. Further, by using confirming real time indicators, like tape reading and analysis, in tandem with MP and order flow, you can initiate some extremely accurate trade set-ups.
Because of the complexity of understanding MP theory and applying it to your trading it is often glossed over as being too technical or time consuming for the retail e-mini trader. I can tell you that time spent understanding market structure, order flow, tape reading, and correlated markets are well spent and will greatly increase your trading accuracy. Is it tough stuff? Yep, it isn't exactly a walk down in the park when you embark on the task of integrating these systems together; but the rewards are manifold.
I am interested in education and technique, not spitting out trades that participants blindly initiate. It's no way to run a business, and your personal trading is a business. Taking blind trade calls is like owning an auto parts store and not knowing the function of a brake rotor or alternator. Like I said, it's no way to run a business.
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