Our strategy is an excellent addition to the classic technical analysis or volume research. Today we share with you our experience and even without additional filters, the ratio of profits and losses is amazing.
Big players are reluctant to share secrets, information about current open orders (Open Book) is partially closed to the general public. In the free access for traders there is only information about the pending limit orders (Level2), but, as a rule, there are a lot of tricks hiding or changing the real state of affairs. Suffice it to recall the iceberg-warrant, spoofing. There are also HFT bots that distort the picture of volumes. A price glass is not the most accurate instrument, although some traders work with it quite successfully.
In the crypto currency market, only one Bifinex exchange (out of several tens of exchanges) provides data on open positions in real time. Having these data, it is possible to assume with certainty that in other areas the distribution of long and short positions is approximately the same. If somewhere abnormal change in volumes occurs, this leads to a price change, which, in turn, leads to the inclusion of arbitration robots quickly leading to equilibrium.
Only the difference between the volumes of buyers and sellers (the forces of bulls and bears) leads to a change in the current price. The delta of long and short positions is called OPEN INTEREST.
Example chart BTC 4H
DIVERGENCE (DIVERGERE (LAT.) - TO DETECT THE DIFFERENCE.
In trading, the option of finding the divergence / convergence of 2 x numerical series is used. For example - the price (the 1st row of numbers) and the numerical value of some indicator (2nd row). Simply put - the discrepancy between the directions of price movements and the indicator.
From a practical point of view, it is interesting to interpret the divergence found - it is important for a trader to know where the price is going to move.
We consider only strong divergences and signals.
Buy signal: Convergence or divergence is formed between the lower fractals of the indicator and the lowest price values at the level of fractals of open interest
Sell signal: Convergence or divergence is formed between the high fractals of the indicator and the high price values at the level of fractals of open interest
On the chart it looks more clear, with pleasure we will answer all your questions in the comments
Divergences have always been considered as leading indicators. If you use price divergences and an open interest indicator, you can get an excellent forecasting tool.
With an indicator of open interest, everyone can read it for FREE! Indicators are on all popular currencies to the dollar and to BTC
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Training in trading with the possibility of obtaining a funded account
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as an indicator predicted the last movements
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The indicator shows a buy signal, the trend is pointing down, but can we go to drop the shorts to 9250? We are waiting for your comments on this situation
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