stepping up or down the bid?????????

[strtedat22 10]

can anyone explain to me in detail stepping up or down the bid...i thought i understood it but i didnt :crap:

 

thanks

[Soultrader 12]

Im not sure if I follow 100% because of the lingo but stepping off the bid/ask is something that can be spotted on the price ladder or level 2. You might see a big size holding the bid a few levels down and then all of a sudden he steps away.

 

For example, on the Nikkei futures each bid/ask is about 400-500 contracts. Once in a while you will see 1000+ contracts at the bid/ask a couple levels above/below the current market price. If the trader is holding the bid 2 levels down and steps off, this indicates he is sensing price to drop lower and loses interest in buying. Usually you will see price drop. Vice versa for the ask.

 

Lets say the markets is tanking rapidly. You may also see the bid getting extremely thin and ppl just stepping off it. There is no buying interest there and no support. Price will continue to drop until the first wave of short covering comes in. Short covering can be spotted easily as they do not hold the bid but send a market order. So you will see price jump a level rapidly. This is the case for financial instruments in which the bid/ask is thick and one big trader can take out the bid/ask.

[strtedat22 10]

Im not sure if I follow 100% because of the lingo but stepping off the bid/ask is something that can be spotted on the price ladder or level 2. You might see a big size holding the bid a few levels down and then all of a sudden he steps away.

 

For example, on the Nikkei futures each bid/ask is about 400-500 contracts. Once in a while you will see 1000+ contracts at the bid/ask a couple levels above/below the current market price. If the trader is holding the bid 2 levels down and steps off, this indicates he is sensing price to drop lower and loses interest in buying. Usually you will see price drop. Vice versa for the ask.

 

Lets say the markets is tanking rapidly. You may also see the bid getting extremely thin and ppl just stepping off it. There is no buying interest there and no support. Price will continue to drop until the first wave of short covering comes in. Short covering can be spotted easily as they do not hold the bid but send a market order. So you will see price jump a level rapidly. This is the case for financial instruments in which the bid/ask is thick and one big trader can take out the bid/ask.

 

thanks soul for that reply. ill have another question real soon once i dentify the buyer at certain level.

[strtedat22 10]

oh yea, how do i determine the high and low values for the day...i was looking at some of your videos and you mentioned those terms.

 

thanks.

[mister ed 10]

Are you referring to the Value High and Value Low of the day? See VAH and VAL.

 

Both of these are Market Profile terms, and to be honest to understand them it would be a great idea to read some of the introductory posts you will find here at the Market Profile forum. Very educational indeed and well worth the time spent.

 

In brief, the value high and low are plotted around a central price referred to as the Point of Control (POC), which is the price that traded most frequently during the day according to time at price. The POC is the longest line of TPOs on the Market Profile chart. The VAH and VAL are plotted so as to contain 70%, or thereabouts, of the day's trading, again as measured in number of TPOs.

[strtedat22 10]

Are you referring to the Value High and Value Low of the day? See VAH and VAL.

 

Both of these are Market Profile terms, and to be honest to understand them it would be a great idea to read some of the introductory posts you will find here at the Market Profile forum. Very educational indeed and well worth the time spent.

 

In brief, the value high and low are plotted around a central price referred to as the Point of Control (POC), which is the price that traded most frequently during the day according to time at price. The POC is the longest line of TPOs on the Market Profile chart. The VAH and VAL are plotted so as to contain 70%, or thereabouts, of the day's trading, again as measured in number of TPOs.

 

thanks mister ed...ill look up those terms on the site.