SPX Flow concepts in real timeThe **flow concept** in trading refers to the way markets move, either easily or with difficulty, in an upward or downward direction. It is a critical tool for traders to anticipate price movements and market behavior.
Key Points:
1. Types of Flow :
- Good Flow: Market moves easily in the expected direction, aligning with targets.
- Poor Flow: Market struggles or moves contrary to expectations.
2. Indicators of Flow :
- Range and direction of the bar.
- Location of the close within the bar (near highs or lows suggests direction).
- Degree of progress toward expected targets within an envelope system.
3. Using Flow in Trading :
- Flow helps traders anticipate targets and identify when market behavior deviates from expectations.
- It integrates multiple timeframes: higher time periods (HTP), lower time periods (LTP), and focus time periods (FTP).
4. Energy and Strength :
- Flow derives from the energy between support and resistance levels (e.g., PL Dot, envelope confines).
- Observing energy shifts at key levels helps predict future price movements.
5. Practical Applications :
- Monitor Real-Time Flow: Recognize changes in direction or strength to adjust strategies.
- Avoid Stops with Flow: Understanding flow can reduce reliance on stop-loss orders by enabling better decision-making.
Conclusion:
The flow concept emphasizes studying and monitoring market behavior dynamically, leveraging multi-timeframe analysis and energy zones. Mastery of flow allows traders to anticipate changes, make informed decisions, and reduce errors.
In the video you see three timeframes from right to left: 5 minutes, 15 minutes and 60 minutes. At key moments in time (at close) the flow shifts and this is marked with 3 green/red boxes allowing the candles to confirm/reject the flow concept. You can see on the 5 minute and 60 minutes the flow changes is identified and confirmed. The 15 minute timeframe shows quickly the same change but it is not confirmed. Then on the opposite side you several flow shifts that are not confirmed, but eventually they also provide confirmation on the 15 and the 5 minute timeframe. This concept shows the importance to flow above terminations or levels.
