Food for Thought

[jagankris]

Who sold it there above open price - where Technically resistance is assumed to be converted in to support and why ?

There could be many TA reasons which can be attributed but unless and untill we have the exchange trade data - else all are just subjective assumptions.

Trend Down.
PDL - 8462.A major resistance.
So technically markets will turn bullish above this price level.
So bears didn't wanted the price to go above that level.
(People who believe in bull/bear theory).

Is it a crucial decision point/resistance where shorts from other Higher time (15m,30M,hourly etc) frame traders - No.

Is it a high volume reversal candle - no.The volume was less.

Is it a bull trap - all short - stop loss placed above open price which was till that point HOD.And fresh long orders placed assumption of reversal were absorbed.

And who sold there - Market Makers + others who were long from the BRN - 8400 - long liquidation and fresh shorts due to technical reasons like Intermediate RN.(8450 - levels),some other Moving average resistances 200EMA in 1Minute or 55EMA in 3 minutes or Oversold in stochastics..

Rajesh,

Your thought process on this.Am I missing some thing here ?

 

[Niranjanam]

Rajesh,

Your thought process on this.Am I missing some thing here ?

These are different issues and ideas.Here I am sticking to my original question in post number 1.
Will you buy at the circled area? Who bought there? Who absorbed both stop loss selling and breakout selling? Why? Have you ever read about any method or system that favors buying at the circled area?
I have explained my reading about this and would like to know alternate explanations so that the discussion will move forward

 

[Niranjanam]

The reason could be the same as any long tailed or wick bar - just the way the market works. Why should it be different in this case? May be its a collision of timeframes, probably that was a huge downtrend in tick chart and people started covering :lol::lol:

More on Wycoff Spring https://wyckoffstockmarketinstitute.com/wyckoff_articles/Buying/spring_article.htm

Yes. These are Wykoff sprigs and Breakout failures. Retails trade after the spring on the way up.They do not create the spring.My question is who buys below the support and create the spring. Have you ever come across a system that recommends buying just below a support in forums and trading literature?

"The reason could be the same as any long tailed or wick bar - just the way the market works"
Then what is special about Wykoff springs? Is every long tailed wick bar a Spring?

 

[wisp]

Yes. These are Wykoff sprigs and Breakout failures. Retails trade after the spring on the way up.They do not create the spring.My question is who buys below the support and create the spring. Have you ever come across a system that recommends buying just below a support in forums and trading literature?

"The reason could be the same as any long tailed or wick bar - just the way the market works"
Then what is special about Wykoff springs? Is every long tailed wick bar a Spring?

Are there not systems that dont use support or resistance? Could it be a Fib level where there were buy orders?

 

[jagankris]

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[jagankris]

These are different issues and ideas.Here I am sticking to my original question in post number 1.
Will you buy at the circled area? Who bought there? Who absorbed both stop loss selling and breakout selling? Why? Have you ever read about any method or system that favors buying at the circled area?
I have explained my reading about this and would like to know alternate explanations so that the discussion will move forward

Just my views

DEFINITION of 'Dark Pool Liquidity'

The trading volume created by institutional orders that are unavailable to the public. The bulk of dark pool liquidity is represented by block trades facilitated away from the central exchanges.

Also referred to as the "upstairs market," "dark liquidity" or "dark pool."
INVESTOPEDIA EXPLAINS'Dark Pool Liquidity'

The dark pool gets its name because details of these trades are concealed from the public, clouding the transactions like murky water. Some traders that use a strategy based on liquidity feel that dark pool liquidity should be publicized, in order to make trading more "fair" for all parties involved.

or

What it means with respect to NSE.

Exchange provides three types of data Level1,Level2,Level3.
Level1 - is 1 second data - Retail.
Level2 - is the one provided to brokers trading terminal - top 5 - market watch quotes.

And level 3 is the one which provides top 20 - Quotes.
And this is only for Members/Institutions/Market makers.

Typically only who can view the market depths and order flow data and who can see where the max pending stop orders are placed can just trigger the stops and buy or sell there and then move the markets as determined.

In short only institutions/market makers/Brokers can do this.

And no Technical system can possibly say in advance where max no of stops placed.

 

[Niranjanam]

A Dark pool is something different. Here the transactions are matched not at the exchange level, but at " Dark pools" which are private transaction networks. Orders are not send to exchanges but settled internally like a parallel exchange.In other words they are bypassing the exchanges.
For example suppose a brokerage runs a dark pool. Orders are matched and settled at Brokerage servers and only those cannot be matched are sent to NSE. These dark pools have nothing to do with exchanges and their data
http://www.marketswiki.com/mwiki/Dark_pool

 

[Niranjanam]

Are there not systems that dont use support or resistance? Could it be a Fib level where there were buy orders?

Possible. There is a difference between Horizontal SR and other levels like Fib, MA,VWAP, Trend lines etc. S/R remains where it is and other levels shift as they are dynamic.
Market behavior can be identified easily if it happens at Horizontal SR and never possible with other levels. If it is not SR then we have to identify where it is Which fib, Which EMA etc. Then only a method with an edge can be developed.

 

[Pradeep Narayan]

Possible. There is a difference between Horizontal SR and other levels like Fib, MA,VWAP, Trend lines etc. S/R remains where it is and other levels shift as they are dynamic.
Market behavior can be identified easily if it happens at Horizontal SR and never possible with other levels. If it is not SR then we have to identify where it is Which fib, Which EMA etc. Then only a method with an edge can be developed.

The one in bold... do we really need to know the potential reversal levels for taking a trade? Yes, if we are the type that trades on the extremes. No, if we can make do with a smaller profit in between.

Personally, I would not try predicting levels for entry... I would take more trades with smaller profits.

 

[rmike]

Interesting!

Will you buy at the circled area?

From the point of view of a retail trader - No

Who bought there? Who absorbed both stop loss selling and breakout selling?

Someone who had a huge order to fulfill/ execute

Why?

Because it is only at the circled zones that such an order could be fulfilled without making the market move adversely to the order's intended average execution price

Have you ever read about any method or system that favors buying at the circled area?

No. Because all 'teaching' systems are configured for the retail audience which does not have that kind of market moving power

This was done by an entity with 3 M's (a) Market Experience (b) Market moving power aka Money (c) Means of being aware of the exact(?!)/ closely approximate number of orders (liquidity) sitting there in those zones

I, personally, would find it difficult to believe that, that entity would have chosen to execute its order based on guesstimation in those zones. This was an execution based on facts (with cause & effect factored in) and hence didn't need any system or methodology

Regards,