Sunday 7 July 2013

The "L2ST Trading FrameWork"

Unlike many others that attempt to teach others the WAY in trading, we DO NOT teach a systematic way to trade.  What we teach is a "Discretionary Framework for Perceiving, Understanding and Ultimately Trading the Markets".  

The "L2ST Trading Framework" consists of focusing on understanding and applying the follow principals:

1. Auction Market Theory – Understanding Participants Behaviours for Negotiating the Market Price and Structure.
2. Value Trading Framework – Understanding a Perceptional Framework for defining fair and unfair prices.
3. Volume Profiling Techniques - Mastering the understanding of Acceptance and Rejection of prices and Market Structure.
4. Perception of Price over Time - Price Pattern Logic for defining Market Structure and Context.
5. Confluence – Short-term Price Patterns and flow, Market Relationships.
6. Preparation - Understanding and then Visualising what the market may do before it does.  This aligns the unconscious mind with conscious plan in ADVANCE.
7. Execution – Dynamic Entry Techniques utilising Price Action and Order Flow.
8. Trade Management – Advanced Position Sizing, Effective Risk Management, Efficient Target and Exit Strategies.
9. Discipline, Belief and Confidence – Through: Business\Life Planning, Self Motivation, Raised Awareness, Mental, Physical, Spiritual and Emotional Development\Management Techniques.

For more information and free training videos visit http://www.l2st.co.uk

Friday 17 December 2010

The L2ST Traders Daily Process

1. Pre-Market Analysis – Homework

a. Use L2ST Pre-Market Analysis Sheets OR even better create your own!

b. Top Down Approach - Longer Time Frame Analysis Daily and30 minute.

c. Value Area Analysis.

d. Volume Analysis - Key Rejection and Acceptance Price Area Analysis.

e. Write down your expected and unexpected scenarios.

f. Write down your Primary Buy and Sell Zones.

2. Visualisation - Anchoring the Vision

a. Print Off a chart (in Colour!) with your Pre-market Analysis zones and expected scenarios. Play the trades in your head whilst looking at the print off.

b. Then start your Visualisation. This should be no more 15 minutes, it is actually better to do this for 5-10 minutes with increased intensity.

c. Anchor the completion of a successful trade with a word by saying it out loud, or a movement.

3. Market Open – Ready to trade

a. Stalk the opportunities as the market approaches your pre-market analysis zones. ONLY do business in these zones, and NO-WHERE else!

b. Adapt intuitively to the present moment, and trade in the Gap between where you are now and where you want to be.

c. Highlight\Visualise the potential Risk\Reward with the opportunity. ONLY look to execute the trade if this is in line with your business plan’s Potential Reward Objectives.

d. Trade Execution – Read Order Flow using MD Footprints\Cumulative Delta for Entry.

e. Trade Management – Once stops and targets are in place at pre-determined levels, do not mess round too much with the trade. Give it time to play off your VISION, whilst holding the vision in the mind’s eye.

Sunday 22 August 2010

The Art Of L2ST Order Flow Trading Seminar

TOPIC: The Art Of L2ST Order Flow Trading
DESCRIPTION: Join Kam Dhadwar of L2ST Traders Coaching as he discusses the skill of Order Flow Analysis in this free recorded seminar.

You will learn the importance of treating Order Flow Trading as a Art Form, and learning how to trust your Intuition for Unconscious and Effortless Order Flow Trading. Also discussed in the video below:

• The Common mistakes that traders make by attempting to mechanise and systematise the Art Of Order Flow Trading.
• Understand that learning how to tap into the power of your Unconscious Mind is ESSENTIAL for trading with order flow (or any method for that matter!).
• Learn how to know when you are IN FLOW with Order Flow and OUT OF FLOW, and how to deal with this.
• Learn about some of the specific tool that the traders at L2ST use for Order Flow Analysis, including MarketDelta Footprints, Depth (DOM)Analysis Tools and the more common Time & Sales.
• You will also be shown some very specific L2ST Order Flow Setups for better Timing of Trades and for Precision Execution.


Thursday 19 August 2010

Trading Order Flow

What We Know About Market Activity

Plotting trade activity using Volume at Price Bid-ASK market Generated Data.

A sell or a buy order executed in the form of a limit order is by definition a passive means of participating in the auction.

The buy or sell limit order rest outside the current price.

Sell limit orders rest above the current price and represent supply.

Buy limit orders rest below the current price and represent demand.

Therefore, buy and sell limits orders are referred to as responsive trade, i.e. such orders represent, from the perspective of the buyer or seller, an opportunity to buy below value or sell above value. When a Seller executes an order at the bid, the trade is the result of the seller accepting the buyer’s bid.

When a Buyer executes an order at the offer, the trade is the result of the buyer accepting the seller’s offer.

Therefore, when the Buyer executes an order at the offer and/or a Seller executes an order at the bid, the buyer and seller are said to have initiated trade.

Initiated trade express from the perspective of the buyer or seller a perception that price is moving away from value.

Watch this Video to see this explained in a Great Animation put together by L2ST Traders Coaching: http://www.youtube.com/watch?v=vWWuztQCcUE


What Causes Price To Fluctuate, Higher And Lower?

In the market profile hand book, the CBOT states:

Price auctions higher because buyers are willing to accept the seller’s offer

Price auctions lower because sellers are willing to accept the buyer’s bid

Therefore, initiated trade occurs when;

Buyer’s “lift the seller OFFER”

Seller’s “hit the buyer’s BID”

Why would a seller, hit the buyer’s BID at the LOW? -

Because the initiated seller, thinks price is going to go lower.

Why would a buyer, lift the seller OFFER at the HIGH? -

Because the initiated buyer, thinks price is going to go higher.

Therefore, initiated trade occurs when;

Buyers: “lift the seller OFFER” because the buyer perceives price is going to move away from value, i.e. go higher

Seller’s “hit the buyer’s BID” ” because the seller perceives price is going to move away from value, i.e. go lower

When, the Seller’s “hit the buyer’s BID”, the buyer’s BID is called resting limit

orders, which indicates a willingness on the part of the buyer to be long at a specific price.

The buyer is said to be responding, to what he perceives as price moving way from value. In other words, the buyer thinks the security is being offered below value, the price is too low.

When, the Buyer’s: “lift the seller OFFER”, the seller’s OFFER is called resting limit orders, which indicate a willingness on the part of the seller to be short at a specific price

The seller is responding, to what he perceives as price moving away from value. In other words, the seller thinks the security is being offered above value, the price is too high.

Definition of Support

Support equals demand, in the form of resting limit order, sufficient in quantity to absorb supply and there by halt the downward movement in price.

IF, the demand turns from responsive buying to initiated buying,

THEN, there is the possibility that price will reverse its direction and auction higher.

Therefore, responsive selling [supply] is responsible for halting the advance and initiated selling is responsible for auctioning price lower.

Definition of Resistance

Resistance equals supply, in the form of resting limit order, sufficient in quantity to absorb demand and there by halt the upward movement in price.

IF, the supply turns from responsive selling to initiated selling, THEN, there is the possibility that price will reverse its direction and auction lower.

Therefore, responsive buying [demand] is responsible for halting the decline

and initiated buying is responsible for auctioning price higher.

How Can Volume At Price Information Be Used In Discretionary

Trading?

IF; price has auctioned down to where previous demand has entered the market and resulted in halting the decline, i.e. Support and the market generated data indicates that the initiated selling [SUPPLY] has met the responsive buyer [DEMAND]

THEN; at your discretions there exists a possible opportunity to go LONG

What Is The Risk?

The Risk is that on a subsequent probe, the initiated seller’s may come back and provide more supply.

IF; Supply increases at the Low, THEN, there is the potential the Demand may not be sufficient to absorb Supply, i.e. Support is likely to be breached and probability would favor price auctioning lower.

In that case, discretion would suggest, LONG positions should be exited, capitol should be preserved and loss should be minimized.

IF; price has auctioned up to where previous supply has entered the market and resulted in halting the advance, i.e. Resistance and the market generated data indicates that the initiated buying [DEMAND] has met the responsive seller[SUPPLY]

THEN; at your discretion there exists a possible opportunity to go SHORT


What Is The Risk?

The Risk is that on a subsequent probe, the initiated buyers may come back and provide more demand.

IF; Demand increase at the HIGH, THEN, there is the potential that Supply may not be sufficient to absorb Demand, i.e. Resistance is likely to be penetrated and probability would favor price auctioning higher.

In that case, discretion would suggest, SHORT positions should be exited, capitol should be preserved and loss should be minimized.