Price Isn't Always Right

One of the dominant dynamics that drives markets across all time frames is that momentum traders create feedback loops that drive price out of balance and away from historical value. These momentum traders tend to take profits at the first sign of trouble. Larger value traders are not inclined to pay a premium. This interplay between the faster momentum traders and the larger value traders creates many of the dynamics that produce the resultant price action across all time frames. Larger value traders express their sentiment by their resting limit orders while faster momentum traders express their sentiment as executed market orders.

Amateurs get overly excited after a prolonged market drive. Professional traders track developing market themes that have the potential to turn the market. Timing is always difficult. Tracking the price action and the order flow can give the swing trader a great confidence and greater accuracy to capitalize on developing ideas. Our premier tape reading and order flow analysis program, AlphaReveal, gives traders the most powerful tools for reading the tape and for making sense of the order flow in real-time. 

Most traders who read this blog know that our software has numerous innovations to help day traders execute at their best. Some may not know that our software can be just as powerful a tool for swing traders and active traders who may have a slightly longer-term outlook. If you trade futures actively then we feel our software will likely benefit you. But, don't just take our word for it: please do take our free trial and learn for yourself how our program can benefit your trading.

Thursday, April 11, 2013 5:17:00 AM Categories: education

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Risk Disclosure:

Futures and forex trading contains substantial risk and is not for every investor. An investor could potentially lose all or more than the initial investment. Risk capital is money that can be lost without jeopardizing ones’ financial security or life style. Only risk capital should be used for trading and only those with sufficient risk capital should consider trading. Past performance is not necessarily indicative of future results.

Hypothetical Performance Disclosure:

Hypothetical performance results have many inherent limitations, some of which are described below. no representation is being made that any account will or is likely to achieve profits or losses similar to those shown; in fact, there are frequently sharp differences between hypothetical performance results and the actual results subsequently achieved by any particular trading program. One of the limitations of hypothetical performance results is that they are generally prepared with the benefit of hindsight. In addition, hypothetical trading does not involve financial risk, and no hypothetical trading record can completely account for the impact of financial risk of actual trading. for example, the ability to withstand losses or to adhere to a particular trading program in spite of trading losses are material points which can also adversely affect actual trading results. There are numerous other factors related to the markets in general or to the implementation of any specific trading program which cannot be fully accounted for in the preparation of hypothetical performance results and all which can adversely affect trading results.