Order Flow Trading

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Table of Contents


Read the Introduction to Order Flow Trading for Fun and Profit

Chapter 1: What is Order Flow Trading?

We start out by discussing what order flow is, and what it isn’t. Then we talk about its various components and how the book’s sections are designed to address each of them.  


Section 1: Market Microstructure


Chapter 2: Microstructure Basics

Before we get into the discussion of market microstructure, we need to cover some basic concepts and terminology. This chapter provides a brief overview of terms and concepts in an effort to eliminate confusion later in the book.

Chapter 3: The Structure of the Forex Market
We begin this chapter with an analysis of the various tiers that comprise the OTC forex market and explore how liquidity flows between them. Then we dispel some myths about the size of the market and explore how realistic it is for participants to manipulate prices.
Chapter 4: Price Change Mechanics
This is where we get into the heart of microstructure analysis. The core discussion revolves around an exploration of why and how prices change. In the process, we also discuss participants, risk, and the interplay between objectives and incentives that influence price change mechanics.
Chapter 5: The Liquidity Distribution Model
Here we introduce the liquidity model, explore how it works, and discuss how we can use it to visualize large numbers of participants interacting across time.
Chapter 6: Price Change and Liquidity Disequilibrium
Building on our understanding of the liquidity model, we explore how it can be used to discover exploitable inefficiencies in market mechanics.
Chapter 7: The Problem of Large Orders
In this chapter we analyze the relationship between account size and profitability, discuss market inefficiency more broadly, and explore the various complications that come with executing large trades.
Chapter 8: The Role of Stops
This is the one you have been waiting for!

Chapter 9: Stop Cascades

What they are, as well as how and why they occur.

Chapter 10: Episodic Volatility

What it is, how it forms, and why it leads to a wide range of exploitable market inefficiencies. More importantly, we discuss some of the specific inefficiencies it produces and how you can construct systems to exploit them.  


Section 2: Order Flow Analysis


Chapter 11: Reading Order Flow

In this chapter we discuss some of the criticisms that have been leveled against order flow trading. After that, we analyze the conceptual processes through which order flow can be read.
Chapter 12: Technical Order Flow
Where, and how large are the technical trader orders? Discover how to gain access to the complete technical trader order book in this chapter.
Chapter 13: Fundamental Order Flow
Fundamental orderflow is a critically important component of all successful order flow system. In this chapter you will learn how to read it and why its important.
Chapter 14: Other Participants
Options, commercials, and sovereign entities. Learn which ones matter and how to exploit the ones that do.  


Section 3: The Metagame


Chapter 15: Core Order Flow Trading Tactics

Here you will learn the handful of tactics that underlie all order flow trading system. We wrap up with a number of systems that you can begin using the minute you finish the book.
Chapter 16: Advanced Order Flow Strategies
Learn how to combine the core tactics with other advanced concepts to bring your trading to another level. You probably won’t be able to deploy the concepts in this chapter right away. They require more skill and experience then the core strategies, but these are the ideas that can take you from good trader to the envy of your peers.
Chapter 17: Parting Thoughts
Finally, we wrap up with an outline of what to do next and some advice on what to watch out for as you cross the threshold of profitability.

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