Orderflow Flashcards
What is OF?
Everything we see in the market is OF. HTF swing structure is OF, weak/strong swing points is EOF, POI’s holding is OF. It’s the by-product of supply and demand moving the market.
When is OF likely to stop holding?
Until the SO has either changed or been completed. The only exception is when there’s a failed CHOCH.
Since these 15M OF ranges are likely to hold, especially for PT moves (not the structural mitigation), we can mark them out and look to take 15M continuations (entering on the LTF) until the 15M objective is completed (low or high taken if PT - or fully mitigated if CT). The market is fractal.
How long do OF ranges hold for?
OF ranges will hold until the structural objective is completed. The SO could be: 1. New swing high/low (continuing EOF) 2. Mitigation 3. deeper mitigation
What are we looking at when we look at orderflow?
When we look at orderflow, we’re looking at supply and demand ranges being continuously respected. It’s the overall ranging movements of price with price moving out of the range, and then mitigating it.
Why does OF create LQ?
OF created LQ for the structural objective. Once the SO is completes, then the OF becomes LQ for the mitigation or for price to continue the OF range.
How can we guess with high probability if the 15M SO has been completed?
If the 15M SO is completed, we’ll have a 15M CHOCH (change of OF)
If the 4H SO is completed, we’ll have a 4H CHOCH (change of OF)
Therefore, the 4H CHOCH signals that the 4H SO has changed
the 15M CHOCH signals that the 15M SO has changed
What is the correlation between OF and the SO?
15M OF will most likely hold until the 15M SO is completed.
We can then guess that once there is a significant 15M CHOCH, then the 15M SO has changed (unless it’s a failed CHOCH)
The 15M SO is often following the 4H OF (either a 4H OF continuation or mitigation) depending on the 4H SO.
When is OF most likely to hold?
On pro trend trades until the objective is complete
using the 15M bearish structure for example, is OF more likely to hold for initiations or for mitigations?
Let’s say 15M is bearish, then we are most likely to see 15M OF holding for the bearish continuations. OF will likely hold for the 15M bullish leg (mitigation), however, the most recent range may be used as inducement. Therefore, when we 2x bearish OF ranges, then its likely that the new low is confirmed weak
When do we need inducement to validate a POI?
We need inducement to validate a POI when it’s a structural play, but when we are trading with OF, we don’t need to see inducement to validate a OF POI.
Will price break the most recent range to tap into an unmitigated one?
In a pro-trend move, price won’t violate the most recent OF range until the objective is complete. Unmitigated POI’s will be used to either continue the trend, or to serve as reaction points for the next SO.
What kind of PA can you think of ranges as?
You can think of ranges in terms of BTS or STB PA.
Can you have ranges within ranges on a single TF?
Yes, you have have overall ranges, and you can have internal ranges within them that are likely playing the objective of the overall ranges
what happens with OF aligns with the SO?
When OF aligns with the SO, that is typically when we have the largest moves in the market, especially for PT moves
If the 4H SO is to mitigate the 4H overall range (4H S is bearish), and the 15M bullish OF is interrupted, what can we assume?
We can assume that the mitigation is complete, or that we need more LQ to drive the price up higher.
the first is most likely to happen if we have already tapped into the 4H overall range or the premium of the impulsive/initiation leg.
If price is not well priced in the overall 4H leg, then a change in OF is likely a LQ sweep and a failed CHOCH to push prices higher
