Q-Tracker Power

One of AlphaReveal's most powerful and unique features is the Q-TrackerTM. The Q-TrackerTM is an innovative display that tracks pulls and net changes in the resting limit orders. Why is this important for you as a trader? Because we have found that changes in the market depth precede changes in the order flow and hence price action. The ability to see the order flow interacting with the resting supply is tremendous benefit that is exclusive to our software. We feel the ability to see changes in the resting order supply is one of the most powerful features in our platform.

The Q-TrackerTM is an advanced monitor which can be customized to individual needs. For example, it can be used to detect spoof orders. However, we like to use it as a highly anticipatory indicator of market sentiment. As such, we recommend either running it in "manual mode" operation or setting the auto-clearing timeout to a very large time out and then using our specialized hot keys for interacting with the display. The hot keys z through m are used for this purpose within our software. The keys can be used to reset, fill, and clear the tracker at strategic times. Please refer to the manual for the specifics.

There are a few different ways that one can make use of the depth-change information. First, if you've identified an area where you want take action then the Q-TrackerTM provides valuable information about where to place your limit order for maximum fill potential and best price. Generally speaking, this is the price where traders are pulling their orders too but not beyond that price. Depending on your aggression and conviction, you can also offer limit in front of where other traders are offering -- or even go to market. Market reversals are often defined by aggressive market order traders paying up just in front of where resting limit orders are building. (Please note, it is not possible to see this activity in a traditional depth of market display. However, our trackers make it relatively easy.)

As such, the second and equally powerful way to use the Q-TrackerTM is as an anticipatory indicator to make better use of market orders. For example, if a trader has a long bias and offers are pulled above the market then that could be the evidence that is needed to go market. Pulls across simultaneous levels are a strong indication of immediate market sentiment. The market will tend to move in the direction of the pulls. 

I share two powerful patterns that I watch for below.

Short "Hammer" Pattern

  1. Overall selling activity running higher then usual.
  2. Market is testing a low and sell side activity is dominant.
  3. Watch for inside offers to come in heavy by tracking the Net Change field of the Q-Tracker.
  4. Go to market when/as offers come in heavy. The benefit for this pattern is that when orders build on a level then there is a risk that a large limit order trader will exhaust the order flow. However, if the offer comes in heavy, i.e there are lots of adds in the net change field, then there's a better chance of a price drive developing.

Anticipatory Price Drive Pattern

  1. Watch for significant pulls across multiple levels.
  2. Go to market in the direction of the pulls in anticipation of price drive.


Monday, April 01, 2013 5:59:00 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.

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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.