Profiting From Abnormally Large Volume Imbalances

Posted by on Nov 17, 2015 in Blog

Profiting From Abnormally Large Volume Imbalances

One of the benefits I often talk about in regards to Orderflows Trader is the ability to see inside the bar as it forms. One of the important things to look for is trading imbalances.

A trading imbalance occurs when there is an aggressive buyer or seller in the market. A buyer is aggressive when they buy the offer. A seller is aggressive when they sell into the bid.

A buying imbalance occurs when the volume traded on the offer is a set ratio (usually 400%) greater than the volume traded on the bid.

A selling imbalance occurs when the volume traded on the bid is a set ratio (usually 400%) greater than the volume traded on the offer.

Orderflows Trader allows the trader to look for and easily see buying and selling imbalances and more importantly to hunt for abnormally large imbalances which might go unnoticed to the untrained eye.

What do I mean go unnoticed? Let me explain a little bit…

Most software will allow you to set the imbalance ratio, usually set at 400%, so that when the volume traded on the bid is 400% greater than what traded on the offer a selling imbalance will occur and vice versa for a buying imbalance, when the volume traded on the offer is 400% greater than what traded against it on the bid side.

Orderflows Trader takes it one step further and allows you to set a minimum volume threshold. So if you only want to see imbalances that are greater than say 1000 lots, you can filter out the smaller imbalances and only see the imbalances where the volume traded is greater than 1000 lots. It doesn’t need to be 1000 lots, you can choose any amount you want. I have one of my charts set to 2500.

Why is this important? When you see incredibly strong imbalances look to go in that direction.

The setting in the Orderflows Trader Software is here:

imbalance settings explained

Here are a few examples:

setup1 explained

 

setup2 explained

You want to see quickly and easily when and where the abnormally large imbalances occur so that you can profit from it quickly. Having to stop for even a second can cause you to miss a trade. You want software that will show it to you as it happens so you can trade accordingly and most importantly quickly.

Once you try Orderflows Trader Software you will realize what you have been missing all these years in your trading.

Take advantage of my special offer now and save 25% off the regular price of Orderflows Trader.