Order box trading
Updated
This is educational :)
You can see that the price is a bit "blurry" at the first order box. Why is this?
Financial institutes never invest their whole money at the same time to get "stopped out" or "margin called". They do this to check how the price is reacting to their orders. For example, if they want to invest 100 million euros in a long position; firstly 20m, then 30, and then 50.
This "blurr" will form what we call the order box.
Now, what happens?
All of the orders will not go to reality. maybe only 70% will. Then, when the price touches this order box area, the price will bump again as a consequence of all the underlying orders. This is what you see at the "support order box". Same thing at the top.
Steps to spot these:
1, find the "blurr"
2, watch for confirmation (aka = second time it touches)
3, trade the 3rd, or 2nd if u are brave, it touches this box.
4, place stop loss just above the box
But what for take profit?
Place it in either the other side of the box, or eventually, at 0,618 of Fibonacci. I use this to trade with the trend and not against it.
Questions? Ask them in the comment area :D
You can see that the price is a bit "blurry" at the first order box. Why is this?
Financial institutes never invest their whole money at the same time to get "stopped out" or "margin called". They do this to check how the price is reacting to their orders. For example, if they want to invest 100 million euros in a long position; firstly 20m, then 30, and then 50.
This "blurr" will form what we call the order box.
Now, what happens?
All of the orders will not go to reality. maybe only 70% will. Then, when the price touches this order box area, the price will bump again as a consequence of all the underlying orders. This is what you see at the "support order box". Same thing at the top.
Steps to spot these:
1, find the "blurr"
2, watch for confirmation (aka = second time it touches)
3, trade the 3rd, or 2nd if u are brave, it touches this box.
4, place stop loss just above the box
But what for take profit?
Place it in either the other side of the box, or eventually, at 0,618 of Fibonacci. I use this to trade with the trend and not against it.
Questions? Ask them in the comment area :D
Note
And you might wonder what the difference between order block/box and supply & demand is? Let me tell you. They are the "same", but different kinds.
The first key difference, is that they have different probability at reversal. Order block zones are better for reversals.
Difference number two, the order block is "blurry" and it consolidates before making a big move, but it doesn't consolidate when it hits next time.
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