VSA and Per-bar Delta

[TheNegotiator 13]

Hmm. My take on cumulative data is rather different josh. I use it as a decision support tool based on where the price is trading and market context - i.e. what mode the market is in. I would like to suggest that if you don't like or get an 'indicator' then just ditch it. It's important that you have a good feel for how you are charting the market. I do think before anyone even starts trading though, a basic understanding of how a market works is most important. Then, use your 'indicator' for a specific task. In the case of cumulative delta, here's a few ways I like to view it.

 

1-On a smallish tf or even a volume chart, watch the flow of the cumulative delta. A clear block upon block of delta is sometimes evident. This could be your otf if you like. In the same vein, if you witness a large price move up say, are there any sellers present? Pure price won't necessarily show this as traders obviously can and do pull their orders before they are filled.

 

2-Sometimes, it's also evident that there are 'waves' of buying or selling of similar magnitude with similar breaks in between them. These waves can give you an idea how a bigger player views the market say post a test of an important price area.

 

3-If the market is balanced short term and is at an important area, what is the delta doing as the market is testing? Say we are pushing up, if the delta is building up, there are two options. Firstly the market could break and probably hard as clearly 'passive' sellers will exit (caveat of this is that activity does not decrease after the break). Secondly, the market could fail to break. In which case the 'aggressive' buyers are kinda stuck there at the top and a strong reversal is possible (caveat that the market has to break the current balance or trend to the downside).

 

Anyway, there are other ways to view these and other types of action, I just like watching the cd to see it.

[joshdance 10]

Negotiator, thanks for your comments.

 

That's the beauty, we all have different tools. What may wind up being a bit of a distraction to me may be a tool for you!

[TheNegotiator 13]

Negotiator, thanks for your comments.

 

That's the beauty, we all have different tools. What may wind up being a bit of a distraction to me may be a tool for you!

 

Absolutely. The key is to be able to find what helps you and discard the plethora of other information/tools. The key is to understand what you are hoping to get out of something. I definitely think people come into trading quite haphazardly and the minimum required to do really well long term is a better understanding of EXACTLY why you want to do something oir look at an indicator etc. and that takes hard work and sometimes a great deal of thought.

[johnw 10]

 

......a great deal of thought

 

.

 

I couldn't agree more with you Neg.

 

Futures trading is a Thinking man's game ... beyond preconceived ideas,

beyond ego, and into the essence of why and how a few Large Traders successfully

place the bulk of the contracts into and out of the market.

[MightyMouse 12]

In my opinion, we should use every bit of information possible to make trading decisions. Information is king. The more we have the better informed we are.

 

There are times where volume and delta will not tell us anything and price is rich in information. there are other times where the converse may be true.

 

As a simple example: if price is back to a level which we can call unchanged and it came from below, that tells us that price has been rising. Will it continue rising or will it recede and become unchanged with a previous low? We will also say that the range of prices that price has traversed on the upside is nearly equal to the range of prices that brought it to the previous low. So the range of prices are unchanged. From a price perspective, I am not getting too much information and if I were trading only price, I think it would be a good bet to take a short at the first minimal change in price direction if I had to take a trade.

 

Volume: if in the example volume was higher over the range of from the low to the high than it was form the high to the low, and possibly (ideally) higher than the last time it went from a low to the same level, that would tell me that there were fewer people interested in getting out on the way down and more interest in getting in or covering shorts on the way up. If there is more interest on the way up, I am no longer very interested in taking a short, expecting price to go back into the range. On the other hand, if volume was lower or unchanged I might still be interested in taking the short.

 

Delta: If in the example, when price was unchanged at the high of the range and volume is higher, whether the delta is higher over the range or lower doesn't tell me too much in terms of whether price is going up or not, but the delta and the range of delta would tell me something about who is trading and how far the current move might go up. Inside traders can both win or lose and getting a better idea of who ( institutional, retail, or etc.) they may be and if they can win or lose is helpful for making trade decisions.

 

If you are opposite me in a trade, I do not know much about you. All I know about you is what I know about human nature. It a cow was coming at a group of you, you might not move from the post where you are standing because the likelihood of it trampling you is slim; in addition, you will not see others move either and it may be frightened by the sight of your group, but if you see the cloud and hear the roar of a stampede of hundreds of cows and see the panic of the people scattering, you will likely be rattled as well and abandon your post. Individually, someone might be grounded by a heavy steel set, but most people give in to fear and panic. Any info that I can get that is going to tell me if you are going to act is good info. Nothing personal of course.

 

Just my 3 cents.

 

MM

[joshdance 10]

Delta: If in the example, when price was unchanged at the high of the range and volume is higher, whether the delta is higher over the range or lower doesn't tell me too much in terms of whether price is going up or not, but the delta and the range of delta would tell me something about who is trading and how far the current move might go up. Inside traders can both win or lose and getting a better idea of who ( institutional, retail, or etc.) they may be and if they can win or lose is helpful for making trade decisions.

 

In your scenario if the delta was very high over that period of time, say, cumulatively higher than it was when price was at the same point last time, would you expect that the strength of the move would be higher, or lower?

 

For CD divergences, I've seen people say that if the delta doesn't return as far as price does, then it's a divergence and means there are still "short holders", for example. I've also heard that the other divergence, that the delta has overextended itself in relation to price, can mean that a reversal is impending due to this "overextension" ... I just hear so many different interpretations that it gets to be a toss up, IMO.

 

Even volume, as much as I have found it useful, really only tells you the amount, and the volume being relatively less or more sometimes may mean nothing, even on a daily basis--maybe fewer people are trading because they're on vacation, or on lunch, or whatever... the bottom line is that prices move because of an imbalance of volume at that time, and only the price bar indicates that imbalance. That being said, I do think volume especially, and even delta, can give some information--the question is, will that information be a helpful addition, or a distraction from what price itself is saying?

 

Can someone post an example of a chart showing how cumulative delta can be useful in making a trading decision?

[MightyMouse 12]

In your scenario if the delta was very high over that period of time, say, cumulatively higher than it was when price was at the same point last time, would you expect that the strength of the move would be higher, or lower?

 

For CD divergences, I've seen people say that if the delta doesn't return as far as price does, then it's a divergence and means there are still "short holders", for example. I've also heard that the other divergence, that the delta has overextended itself in relation to price, can mean that a reversal is impending due to this "overextension" ... I just hear so many different interpretations that it gets to be a toss up, IMO.

 

Even volume, as much as I have found it useful, really only tells you the amount, and the volume being relatively less or more sometimes may mean nothing, even on a daily basis--maybe fewer people are trading because they're on vacation, or on lunch, or whatever... the bottom line is that prices move because of an imbalance of volume at that time, and only the price bar indicates that imbalance. That being said, I do think volume especially, and even delta, can give some information--the question is, will that information be a helpful addition, or a distraction from what price itself is saying?

 

Can someone post an example of a chart showing how cumulative delta can be useful in making a trading decision?

 

In my example, I would want to go long if delta was high or if delta was low and price was unchanged at the top of a range and volume was high. In this case, delta doesn't tell me much. Price is rising and you should not be bet against it because volume is increasing on the move up. The likelihood in this scenario is that if price attempts to reverse downward, it will be met with weakness. Is that a guarantee? no.Would I exit if it did try to reverse? probably. Would I get back in if it started to go back up? yes. I would also consider the price range relative to other price ranges and the delta range relative to the delta ranges and the time that it spend within that range. If the delta is high and price is increasing and volume is increasing, then you can expect delta to continue to increase too. Delta, in this instance, will be finding a new level. What will matter most is what it does next and now what it does now. So, it is best to put delta aside for the moment. If price is rising and volume is high and the delta is high, that tells me that possibly patient sellers are losing and aggressive buyers are winning. If price is high, volume is high and delta is low, that tells me that the aggressive sellers are losing and the patient buyers are winning. Either can win and at this moment in time, all that really matters is that price and volume are increasing.

 

You have to consider each and every possibility as it develops to determine which indicator ( Price, time, volume, delta, etc) is giving you solid information and which at that moment are ambiguous. You then need to judge whether you want to take a trade with a lot of ambiguous information or a little ambiguous information. I promise you that some of the best trades arise out of relatively ambiguous situations where traders continue to fight the direction.

 

That guy sitting on the step of the pit at the CME holding his head in despair amid the sea of spent order tickets is a guy who spent his day fighting direction. This is the guy who makes trading profits possible.

 

MM

[joshdance 10]

... In this case, delta doesn't tell me much.

 

...Delta, in this instance, will be finding a new level. What will matter most is what it does next and now what it does now. So, it is best to put delta aside for the moment.

 

...Either can win and at this moment in time, all that really matters is that price and volume are increasing.

 

 

After reading your scenarios above MM, I could not conclude based on your statements that a negative or positive delta would have much influence in your decision-making. You said above that "delta..will be finding a new level", but I could not find you saying that your bias on price would change one way or the other by having the delta information. At least not in the example you described--I realize there may be other examples in which this is not the case.

 

If I seem like I'm poo-poo-ing on delta, I'm really not. I just would like to see examples of how it can be used in real time, not hindsight, to give helpful input to a trading decision. The earlier example I cited, the down day recently on oil where delta began turning up like crazy as we neared the 106 level, would perhaps be one example of how it could give you some confirmation that the move down is slowing. But, not until the next day did that level become enough of a support to move up, AND this could be discerned on its own by (1) the large area of consolidation and volume build-up, (2) the huge volume on the move down followed by the inability to push lower.

[KeyToTheCastle 10]

I'm thankful that I came upon VSA back when I did. It opened my eyes and helped me become more aware of supply/demand principles at work in the market such as climactic activity and the condition of no demand or supply. Personally, using it on its own I found no edge and don’t currently utilize VSA concepts directly in my trading but it did lead me to looking further into order flow and supply demand principles.

 

I’ve come to find CD to be a highly effective way to gauge supply and demand pressure and to track inventory in the market. There's very useful information to be gained by monitoring the order flow at key price levels and in certain context. It allows you to look inside a normal vertical price bar and form a logical conclusion on what's occurring in the order flow....losers capitulating, winners taking profit, new trades being initiated. Personally I find it very useful for confirming trades in previous zones of supply/demand imbalance.

 

The thing is most retail traders are trying to find the one best way to enter and exit the market mechanically with hard and fast rules, looking for something that will show them exact turning points in price with no regard for the context of the market at the present time or being able to adapt to changing supply and demand conditions.

 

My goal as a trader is to identify the high probability, low risk price zones ahead of time and know what I want to see happen at these key areas when price comes into them in order to take the trade. But I also have to be willing to change my mind at the last minute if the market tells me something different and be able to adapt to changing real time order flow conditions.

 

Realize that just because CD is showing divergence, ie no demand at a high, this doesn't mean that 30 seconds from now demand can't come back in and cause that divergence to disappear (more so on a smaller time frame). Does that mean I get out of my short...maybe....maybe not. Maybe I'll see that it's just a few nervous shorts covering out and as soon as the little bit of new demand they create diminishes then supply will come in and the market will start to drop. Or, maybe the little bit of demand will make more shorts bail which in turn causes new stops to get hit which causes the market to cycle to new highs. Either way I manage it dynamically.

[joshdance 10]

Thanks KTTC-- although I realize it's a per-situation decision, could you post a chart or some type of visual to describe how you might have (or actually did, even better) trade a specific situation so I can get an idea as to what the CD is telling you? Just hearing someone talk through their logic in an actual situation would probably do wonders for my understanding of this.

[MightyMouse 12]

After reading your scenarios above MM, I could not conclude based on your statements that a negative or positive delta would have much influence in your decision-making. You said above that "delta..will be finding a new level", but I could not find you saying that your bias on price would change one way or the other by having the delta information. At least not in the example you described--I realize there may be other examples in which this is not the case.

 

If I seem like I'm poo-poo-ing on delta, I'm really not. I just would like to see examples of how it can be used in real time, not hindsight, to give helpful input to a trading decision. The earlier example I cited, the down day recently on oil where delta began turning up like crazy as we neared the 106 level, would perhaps be one example of how it could give you some confirmation that the move down is slowing. But, not until the next day did that level become enough of a support to move up, AND this could be discerned on its own by (1) the large area of consolidation and volume build-up, (2) the huge volume on the move down followed by the inability to push lower.

 

You are reading it correctly. in my example, delta isn't going to tell you too much.

 

An example of how delta might be helpful is if there is a nice move up in price on decent volume and then price reverses on even higher volume and retraces some percentage from the high. Now you have a high volume situation that it might feel uncomfortable stepping in front of and it should feel uncomfortable stepping in front of it. Lets say that the delta is very low now much lower than it was when price is at its current level last time. well that tells me that there is a lot of aggressive selling and, at the same time, a group of traders, inside buyers, is willing and doing a pretty good job of absorbing all the supply that is coming from the outside sellers and are holding price within a small range. As soon as price gives me a remote indication that it is reversing back up, I would be all over it with a long because I would expect those who patiently purchased all the supply on the inside to start hitting the offer and searching for stops to create an upward flow of orders so that they can get out at the old high or higher.

 

On the other hand, if the same situation occurred with higher delta instead of lower delta for the level, then I would either be short or wish I was short because I would expect price to continue lower and it is doing so on high volume; however, in no way would I want to be long unless other things presented themselves.

 

In the above scenario there are other things to consider too, but delta is one of the lead indicators that I would consider.

 

Keep in mind that once you enter a trade it is just beginning. You still have to decipher what happens next to squeeze money out. There is no such thing as a magic set it and forget it entry. You need to make decisions and it is going to require judgement.

 

Once you learn what you need and want to see then "screen time" takes on a whole new meaning and the learning curve turns up quickly.

 

MM

[joshdance 10]

An example of how delta might be helpful is if there is a nice move up in price on decent volume and then price reverses on even higher volume and retraces some percentage from the high. Now you have a high volume situation that it might feel uncomfortable stepping in front of and it should feel uncomfortable stepping in front of it. Lets say that the delta is very low now much lower than it was when price is at its current level last time. well that tells me that there is a lot of aggressive selling and, at the same time, a group of traders, inside buyers, is willing and doing a pretty good job of absorbing all the supply that is coming from the outside sellers and are holding price within a small range. As soon as price gives me a remote indication that it is reversing back up, I would be all over it with a long because I would expect those who patiently purchased all the supply on the inside to start hitting the offer and searching for stops to create an upward flow of orders so that they can get out at the old high or higher.

 

On the other hand, if the same situation occurred with higher delta instead of lower delta for the level, then I would either be short or wish I was short because I would expect price to continue lower and it is doing so on high volume; however, in no way would I want to be long unless other things presented themselves.

 

So from the above, it sounds like you are taking the basic approach of fading the direction of delta. You are going with the passive buyers or sellers in either situation. Correct?

[MightyMouse 12]

So from the above, it sounds like you are taking the basic approach of fading the direction of delta. You are going with the passive buyers or sellers in either situation. Correct?

 

In this very specific instance, yes.

 

It is not a general rule. Fading the delta at times can kill you. The passive traders do not always win. Those traders are the fib traders who frequently get caught catching the knife, seeking low or high tick nirvana.

 

Delta is a tool. Its not an all in one tool. At times it is useful at other times, like my earlier post, it is not very useful or simply doesn't help you at the moment.

 

MM

[KeyToTheCastle 10]

Thanks KTTC-- although I realize it's a per-situation decision, could you post a chart or some type of visual to describe how you might have (or actually did, even better) trade a specific situation so I can get an idea as to what the CD is telling you? Just hearing someone talk through their logic in an actual situation would probably do wonders for my understanding of this.

 

Yes, I'll post some charts this coming week.

 

In another post you had mentioned something about passive buyers or sellers. Personally I'm not interested in passive limit orders.

I use CD and other order flow studies to track trades going off at the bid or ask. What I'm measuring is the difference between active buyers and sellers of the market. These are traders that want to get in or out of the market right now with a market order, instead of passively working a limit order and waiting to see if they get filled.

These traders tend to have more conviction...maybe they're losing traders, capitulating, bailing on positions, or winning traders taking profit or perhaps they're initiating new positions. So to be clear I'm tracking a trade at the bid price as a sell and a trade at the offer as a buy. Sometimes I'm organizing this information to track actual inventory, other times I'm organizing it into more of a buy pressure vs sell pressure scenario.

[TheNegotiator 13]

Another idea which can be seen in the markets at certain times is when institutions have to do a lot of business. Because of the size going through, they would move markets if they did everything at market, so many choose to do their business over some time and at the bid or ask. On occasion, the market will trend in one direction in price and in the other in cumulative delta. When this happens, my interpretation could be that this is a BIG player in the market. So thinking about the implications of the data you have in front of you is key.

[johnw 10]

Another idea which can be seen in the markets at certain times is when institutions have to do a lot of business. Because of the size going through, they would move markets if they did everything at market, so many choose to do their business over some time and at the bid or ask. On occasion, the market will trend in one direction in price and in the other in cumulative delta. When this happens, my interpretation could be that this is a BIG player in the market. So thinking about the implications of the data you have in front of you is key.

 

It is a joy to read an intelligent comment, rather than the hit and miss guesswork that seems to have attached itself to this thread.

[TheNegotiator 13]

Thanks John! Just to elaborate slightly on the last comment I made, when you interpret the data in front of you contextually, you must also take account for your own fallibility and external influences which can turn the market on a dime. I know it's obvious, but any way in which we study a market is based on our interpretation of history and how those conditions may be likely to influence the future, with all things being equal. Delta/CD are no different.

[MightyMouse 12]

It is a joy to read an intelligent comment, rather than the hit and miss guesswork that seems to have attached itself to this thread.

 

Wow!

 

Out of curiosity, which camp are you in? the intelligent or the hit and miss?

[johnw 10]

Thanks John! Just to elaborate slightly on the last comment I made, when you interpret the data in front of you contextually, you must also take account for your own fallibility and external influences which can turn the market on a dime. I know it's obvious, but any way in which we study a market is based on our interpretation of history and how those conditions may be likely to influence the future, with all things being equal. Delta/CD are no different.

 

We start off in this game with attitudes imported from other unrelated ventures. We don't know this at the time because it is just the way we are and it is the sum total of our experiences in the outside world.

 

A turning point arises when we come to understand that this game requires a fresh approach, mentally, physically and spiritually.

 

Another turning point arises when we come to understand that we must try to stabilise as many variables as we can [including ourselves], leaving Price as the main variable.

After all is not trading Price the name of the game.

 

Another turning point arises when we come to understand that elimination is a logical step.

The more inputs we can eliminate, then the more stable we become.

The trick is to know what is essential and what can be eliminated.

 

By this stage, our mechanical inputs are stable and our trading abilities as Individuals are becoming more stable and solid week by week.

 

As the market squirms and twists in it's usual manner, our % accuracy and reward/ risk ratio remain within stable bands ... what does change is the number of trades taken each day .... trend days require fewer trades than compression days.

 

As our mind and our coordination stabilise, it becomes apparent that any other Trader achieving stable results, views the price pretty much as we do, since it is the only thing moving.

 

Arguments and heavy discussions on TL arise when Traders have differences of opinion... this is a healthy state in most ventures where the outcome is determined by emotional and expressive means.

 

However in trading, it very much defines the level of emotional stability of the Trader

 

Everything that we do as Traders must take it's lead from Price.

The litmus test is always to remove the input to gauge the effect, but this can only work when the Trader is in a stable state.

 

Frankly, I don't believe this is all that difficult to achieve.

 

Just eliminate everything except price bars, then ask yourself who decided what size and type bar frame you are watching.

If the answer is anything other than YOU then that is your starting point.

If the answer is YOU but you do not understand order Flow, then your starting point is SELF DECEPTION and how to remove it.

 

All it takes is passion and never ending commitment

Edited April 25, 2011 by johnw

[BlowFish 10]

It is a joy to read an intelligent comment, rather than the hit and miss guesswork that seems to have attached itself to this thread.

 

Hit and miss guesswork often seems like the name of the game for many.

 

Without wanting to comment on the veracity of Negotiators observation, I wonder why you considered it 'intelligent' rather than more 'hit and miss guesswork'? I presume because it fits in with your belief system. To me it is just another unsubstantiated observation (it may or may not be valid).

 

Incidentally there is a lot of empirical research (since the late 80's) on using trades at best bid ask as a method of determining trade direction. Whilst they won't make anyone more intelligent there is no excuse to be uninformed.

 

btw liked your follow up post.

[TheNegotiator 13]

Well, I hope I could say it is more than just guesswork in the traditional way we would use that term. However, everything we do is fundamentally best guess. It's whether we understand the variables which are likely to be more critical to our specific set of circumstances which separates intelligent guesswork from just plain rolling the dice.

[johnw 10]

........................................................

 

btw liked your follow up post.

 

 

I am not a regular contributor here at TL, but just lately I have had the time and the urge to put a few lines together and they are more about who I am than trying to convince the Readers of anything.

 

It is the smorgsbord of life really ... take what you want and move on leaving something for the next guy.

 

Now, just a few more scribblings, following on from my last post.

 

Yes, I am dedicated to stabilising everything over which I have some control, leaving Price as the moving target.

 

When we first arrive at trading, we arrive on the circumference of a circle with Price at the bullseye.

We don't know it yet as we stand at the circumference, but each step towards stabilising everything other than Price, moves us a step deeper into the circle.

I call this the circle of understanding and it tells me where other Posters are in the journey, but the real purpose is to keep me locked into the bullseye.

 

Ever morning I mull this over to keep me focused and prevent me from becoming lost.

 

As you know there are three possibilities when entering a trade

 

a] ... trade goes your way quickly [ congratulations]

b] ... trade dithers around [ wiggle out after n bars or x minutes]

c] ... trade goes quickly against you [ avoid c at all costs]

 

Mostly when we start out, we become entangled with TA and of course we may join TL and meet other entangled people.

 

Both TA and TL have an inbuilt propensity to revert to 50/50 and if we are not careful we are already setting our objectives lower than they should be, by virtue of thought transfer.

 

In this game we need overwhelming odds and we can create them and thereby apply them to our advantage.

All that is required is overwhelming commitment which in turn demands total passion and a will to let go and change.

 

Let us return to c] for a moment.

 

A Poster wrote here that he doesn't bother with Passive Inventory.

Well, I do, because when I enter a trade I want huge Passive Inventory covering my 6 [my back] to reduce the odds of c] occurring and I don't want to see equally big chunks of PI in front of me for obvious reasons.

 

Much is made of TA and it has a place.

For example I do not sit all day in front of the screen. Instead I have an alarmed Alert that calls me back to the screen when a Buy/ Sell zone is entered.

The Alert is a piece of code that is both crude and unintelligent as it's sole purpose is to return me to the screen.

 

Then I go through my check list to determine the Market mood and Market position before deciding upon my stop placement ... from this stop I enter a bracket OCO 'n' tics from my stop.

 

When I am filled I toogle the two limits around the DOM until I take profit and am flattened out... I never open my stop.

 

Anyway, that is how I use intraday delta.

On a daily basis it becomes more reliable as a means to see into the market.

 

Overwhelming odds require overwhelming commitment.

If you have played or performed outside you skin in some other venture

you will have carried this through with you into trading.

 

If you THINK you have, then the odds are you most probably haven't, but you are aware and therefore on your journey.

 

And ...If I have offended you in anyway, then just ignore me and my posts.

[BlowFish 10]

Well, I hope I could say it is more than just guesswork in the traditional way we would use that term. However, everything we do is fundamentally best guess. It's whether we understand the variables which are likely to be more critical to our specific set of circumstances which separates intelligent guesswork from just plain rolling the dice.

 

I was not suggesting it was I was more interested in johns acceptance of the statement Actually there are so many different types of participant with quite different agendas and modus operandi, I always used to think it a bit naive to assume that you could track order flow by simply looking at the delta. In the past I too have observed an instrument go up for two days straight whilst the delta goes down for two days straight. I was quite a 'delta sceptic' knowing a little about the variety of ways large orders get worked. To use johns parlance it was a variable that was not helping stabilise things.

 

Further investigation revealed that there has been an awful lot of research by credible academic institutions (with rigorous and well defined test criteria) which it seems foolish to ignore. One of the things that surprised me is that pretty much all the studies that tested it, concluded that delta is a better indicator of trade direction than I had given it credit for by simple observation.

[joshdance 10]

Blowfish, can you share the source of these studies? I would love to read them and learn more.

[johnw 10]

I was not suggesting it was I was more interested in johns acceptance of the statement Actually there are so many different types of participant with quite different agendas and modus operandi, I always used to think it a bit naive to assume that you could track order flow by simply looking at the delta. In the past I too have observed an instrument go up for two days straight whilst the delta goes down for two days straight. I was quite a 'delta sceptic' knowing a little about the variety of ways large orders get worked. To use johns parlance it was a variable that was not helping stabilise things.

 

Further investigation revealed that there has been an awful lot of research by credible academic institutions (with rigorous and well defined test criteria) which it seems foolish to ignore. One of the things that surprised me is that pretty much all the studies that tested it, concluded that delta is a better indicator of trade direction than I had given it credit for by simple observation.

 

Hi Blow,

 

It is not that I accept Neg's statement per se, but that I have been down the same path and there is more to contract summation at the bid/ ask than the usual delta stuff, and I mentioned this plus an interesting exercise ... well interesting to me.

 

I appreciate posts from people who put in the extra miles and extend themselves to establish what makes this game work and The Neg was picking up on something that flies under most people's radar.

 

I ask Posters to provide evidence or proof to back up their statements.

Either I have my own or I will produce it for myself.

In the same vain, I offer nothing other than a reflection of my views of the market in my Posts.

 

Those Readers requiring charts and empirical substance from me will be sorely disappointed, because either they can follow where I am coming from, or they are too far out on the Circle of Understanding and it will lead to frustration.