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     captain_chaza
Member
Username: captain_chaza
Post Number: 2767
Registered: 02-2003Rating: N/A
Votes: 0
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| | Saturday, October 20, 2007 - 04:21 pm: |  
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A lot has been said on how the Market Depth can be useful
I have always done a lot better when I ignored this set of useless information
As my broker once said to me
"The worst thing the ASX ever unleashed on our Mums and Dads was to give them Market Depth"
I agree with him and have found that almost every mistake I have ever made has it's route in watching this Devil of an instrument
I seem to have always won lots more prize-money when out-of-sight of the Market Depth
That should prove it to everyone!
As we all know this Captain is a very slow leaner
I am truly amazed I have given this devil another chance and then another and then another
Crikey!
That's what some people call the Patience of Saints
No more for me!
Can anyone see any use for having such a devil of an instrument onboard?
I don't!
Salute and Gods Speed
PS However
The "Course of Sales" is another matter!!!!!!
This one could have a lot of merit once you can filter out all the bullshit sales (noise)
TBC
"While we stop and think, we often miss our opportunity." Publilius Syrus, 1st century B.C.
"I believe the future is only the past again, entered through another gate."
Sir Arthur Wing Pinero 1893
"There are two times in a man's life when he should not speculate: When he can't afford it, and when he can." Mark Twain, 1897
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dug
Member
Username: dug
Post Number: 2417
Registered: 07-2005
Rating: N/A
Votes: 0
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| | Saturday, October 20, 2007 - 04:46 pm: |
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Why,for what reasons,did this Broker say this about our mums'n'dads?Why do you endorse,Captain such "patronising"?
Did this Broker get a laugh out of the Mis Reading by these "amateurs"?Was he amused at how easily they were flumoxed by The Open/Close Auction?
Tell us,Charlie some Reasons not just issue down-pat,stock standard POV[point of view] that leaves us Outsiders wondering if there are Valid Negative Reasons that should cause us to ignore Market Depth.
I'm afraid just cos YOU say so,just ain't good enough,Charles.
Happy Trading.
won't post ANY reply til tomorrow.
"I hear WHAT you say,
BUT I SEE what you DO"
Zelman Cowan 1970 Canetoad!
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coyotte
Member
Username: coyotte
Post Number: 266
Registered: 12-2002
Rating: N/A
Votes: 0
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| | Sunday, October 21, 2007 - 01:15 am: |
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can be be ambiguous -- depends on the stocks being traded -- minnows, fish or whales.
If minnows i'd presume you would want to see some level of pre-order interest either side .
but a stock that is traded by the Institutions would be a different matter -- their trying to buy at wholesale and sell at retail --- why on earth would they show their hand with a pre-order ? -- besides most pre-orders are far to small for these guys and it is they that move a price -- no institutional support , then no ongoing supported price rise.
have lost count of how many times you see a couple of massive orders either just below/above the current going price appearing to be either offering support or dumping , suddenly disappear when/if price enters that price zone , yet no sales of that size have gone through.
Guppy also goes on in his book about Chinese Trading Strategies that if you have a large parcel and price is near your selling price at say $1.10, then put in a relativity small pre-sell order for $1.11 -- 9 times out of 10 someone will put in a $1.10 Buy ( you sell into the market at $1.10 ) -- and just keep drip feeding the market at this $1.11 level so as not to spook it -- also visa-versa
just observe how many times you see a stock thats been dropping in price over a period with no apparent pre-order support , suddenly out of the blue (NOT a PRE-ORDER) gets a spike in Volume, that turns out to be stopping Volume and sends it back up again or visa-versa -- OXR used to be notorious for doing this --- SEN done something similar on Thurs, the pre-order "sells" where just gobbled up by "non pre-orders buys" whilst the "pre-order buys" got caught unawares, then came in to late and they got gobbled up in the sell off
"it's a cat and mouse game " and the cat a'nt gonna tell us mices what it's doin
The "Sea of Uncertainty" is defeated by the nimble vessel "Probability", not the unwieldy vessel "Prediction".
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captain_chaza
Member
Username: captain_chaza
Post Number: 2774
Registered: 02-2003Rating: N/A
Votes: 0
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| | Sunday, October 21, 2007 - 01:44 am: |
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Great stuff Officer Coyote
The problem appears most and in its worst when a share price rises against the weight of the market depth
IE: Under the heavy weight of sellers everywhere and a small amount of buyers
"A Share Rises"??????
This could be akin to a God Rising out of the ashes
"A Poseidon"
But it is not
This is merely heading NE or NNE sails presented to the wind
This is always a magnificent sight but always seems to shake me loose
It's an area of seamanship I need to do a lot more work on!
Salute and Gods' speed
PS
I envy you lucky bastards who have the Market Depth worked out
PPS It's time like these I need a much Higher IQ than average
Ahoy Officer JustIce aka (Kossie)
Could you please email me privately ASAP
"While we stop and think, we often miss our opportunity." Publilius Syrus, 1st century B.C.
"I believe the future is only the past again, entered through another gate."
Sir Arthur Wing Pinero 1893
"There are two times in a man's life when he should not speculate: When he can't afford it, and when he can." Mark Twain, 1897
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coyotte
Member
Username: coyotte
Post Number: 267
Registered: 12-2002
Rating: N/A
Votes: 0
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| | Sunday, October 21, 2007 - 08:26 am: |
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I could be being over cynical here
(no offense to others intended )
but the way i look at it, what is "market depth" telling me about the people that place these pre- orders for a extended period .
1: they will only BUY if the price is falling ?
2: they will only SELL if the price is rising ?
come to your own conclusion on that one.
I must be missing something here because i rarely use pre-orders , except at the actual order time and then it will be at the going price -- let the other guy/gal have their piece of cake ,if your on a good thing the price variation is generally peanuts.
-------------------------------------------------------------
this is different to Institutions buying low areas and selling high areas .
.
(Message edited by coyotte on October 21, 2007)
The "Sea of Uncertainty" is defeated by the nimble vessel "Probability", not the unwieldy vessel "Prediction".
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philr
Member
Username: philr
Post Number: 261
Registered: 04-2004Rating: N/A
Votes: 0
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| | Sunday, October 21, 2007 - 10:23 am: |
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I disagree with CC I have always found market depth to be a good guide to the trend of a stock. I am talking about the total of the depth not just the 1st few levels.
If the total depth of buyers is greater than the total depth of sellers the stock will almost alway creep up. The opposite is also true.
It can on occasions be manipulated but this is usually a short term thing.
Phil
** Let blockheads read what blockheads wrote.
Warren Buffett
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dug
Member
Username: dug
Post Number: 2420
Registered: 07-2005
Rating: N/A
Votes: 0
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| | Sunday, October 21, 2007 - 11:30 am: |
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I've read this comment about Market Depth before,philr and I still cannot "get",agree with it.
I really wonder about those who put in Bids a long way from the Action.Aren't they subject to actually having their money "locked up" to cover this? Isn't it like it is for me that I have to maintain that Buy price in actual cash in my account or is it that it's like ringing your broker,placing your order and only having to ante up if/when it happens,a T3 deal?
old ready2rob uses this method of real low Bidding,catching any kangaroo tails,stop loss raids etc.Me on the other hand am concerned that if my Low Bid is met,the price retreats so significantly,I mightn't WANT to buy,shouldn't buy cos I could be catching a falling knife,mightn't be on Day Watch at the relevant time.
Anyway,I wander,and philr I agree that especially the drying up of the Sell ASK levels can make your heart leap,make you feel one is on d'Edge,gonna get a WIN,satisfy a craving,yes quite d'Rush!pity it is usually a trigger for those Big off screen HITS seconds,minutes later.
Happy Trading.
"I hear WHAT you say,
BUT I SEE what you DO"
Zelman Cowan 1970 Canetoad!
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hilarius
Member
Username: hilarius
Post Number: 3082
Registered: 04-2004
Rating: N/A
Votes: 0
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| | Sunday, October 21, 2007 - 12:20 pm: |
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Dug you are absolutely right (trying not to be patronising here)
It is amazing how often the sellers come out of the woodwork after a price rise and the buyers after a price fall ... with their buy or sell prices revealed only as they hit the bid or ask prices in quantity driving the price back in the opposite direction
They never seem to disclose their total orders in the market depth but just sit invisibly waiting to pounce
Equally I agree with others that a SUSTAINED lack of sellers in market depth with a rising price and decent volume can be bullish and the opposite can be bearish signals
Coupled with volume and momentum and solid buying or selling at the much awaited VWAP the signs all work together, along with other chart indicators such as crossovers, GMMAs, support and resistance and the like
The trader needs a bag of tools
Hilarius
I come in peace to share my thoughts and to shine my candle light on possible long term opportunities
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dug
Member
Username: dug
Post Number: 2421
Registered: 07-2005
Rating: N/A
Votes: 0
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| | Sunday, October 21, 2007 - 12:30 pm: |
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coyotte on liquidity,turnover daily/weekly,Volume.
Surely we don't have to keep pointing pitfalls as our main raison d'etre for Posting?
like if there's dills reading this who are Buyers of 100k# 20cent shares in a Daily TurnOver-er that does say only 500k total turnover in a Day?
Even if this event of Volume Liquidity Equation happens in ya share Seldomly?
if such dills are our audience,THEY who we must disclaim to?
......ahh i ramble.
Charles,you once chucked out a one liner i interpreted as-
Do d'Dash;Volume will Follow.
It was 2Do with low volume shares.
Part of Our mutual "speciality"/Passion.
any follow up?
even how about expanding on that broker quip bit?
"I hear WHAT you say,
BUT I SEE what you DO"
Zelman Cowan 1970 Canetoad!
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coyotte
Member
Username: coyotte
Post Number: 268
Registered: 12-2002
Rating: N/A
Votes: 0
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| | Sunday, October 21, 2007 - 01:13 pm: |
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in post No. 267
I am referring to the "quality " of the information.
sure we all look at MD, it's just something that one do's naturally - but how much weight you assign to it is like any other indicator -- the quality and suitability for the "method & stock" being traded --- I would highly suspect that MD although deserving of a weighting, that in the vast majority of trades that weighting would be well down the scale .
I'm not having a go at anyone here :
but for instance a interpretation of MD of these two stocks.
MD has been relatively the same over the past week.
PHK -- would appear a severe lack in demand -- a 1:2 ratio , yet as soon as demand is gone at a particular price level up pops a new buyer at that level ?
SEN : --- demand/supply evenly balanced -- every time demand/supply is threatened to move out of balance a heap of new orders to put it back in balance ?
what you "do" with this info is beyond me -- once a move is confirmed , then I've got something to work with .
.
.
The "Sea of Uncertainty" is defeated by the nimble vessel "Probability", not the unwieldy vessel "Prediction".
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dug
Member
Username: dug
Post Number: 2435
Registered: 07-2005
Rating: N/A
Votes: 0
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| | Tuesday, October 23, 2007 - 10:42 am: |
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coyotte,
Market Depth is useful when the share is "active",there's transaction activity.As I don't have LIVE only refresh,real flurries multi transactions over seconds can't be "read" by me.Part of the reason I don't Do Blue Chips.
As for shares like PHK,market depth watching is a bit irrelevant in it's current stage.I merely check the Size of Bids to Asks sometimes.Just looking to see whether the absorbtion of a Single Have2Seller of say 100k in PHK can be accomodated.Same with DYE.
Shares like these are currently being "ignored" by retailers,the common pilgrim is more bedazzled by tin pot mining explorers because these "work" in providing Thrills.
I'm jaded,would rather get into what I see as an Emerging Sector that in the past was seen as wooly boffins or long hairs preserve.
Do Gooders like,well I reckon some of these type of shares are really for d'DO GOOD.
and watching their Market Depth aids in confirming or denying this to me.
cheers.
"I hear WHAT you say,
BUT I SEE what you DO"
Zelman Cowan 1970 Canetoad!
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rockon
Member
Username: rockon
Post Number: 223
Registered: 08-2003Rating: N/A
Votes: 0
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| | Tuesday, October 23, 2007 - 06:10 pm: |
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Spent an hour typing a (small) post this arvo only to have I/C tell me that I wasn't logged in which I was so I ain't re typing all that again.
The most useless and time wasting resource to me is the hourly chart updates on I/C. I cannot work out how anyone can use information that they see on a chart that actually happened a half hour ago and by the time any sort of decision can been made,the circumstances as well as the chart may have changed again.
Some may disagree with me, because I/C keep on with these hourly snapshots and thus they must be a benefit to some people although not me.
Market Depth on the other hand helps me immensely when things are moving very quickly as in announcements etc.Even one minute charts are inferior when things go ballistic after some exciting news and prices explode upwards only to peak and fall back which is where one wants to exit.
There are too many people attacking the markets from too many angles (daily, weekly, monthly ) for there to be something in place to keep everyone happy at the same time, but for each one of them to look at the screen at any particular second of the day, at least with M/D they can all see what's happening at that very second.
I haven't got a problem with anyone who says that M/D is a load of bollocks because what works for some... don't work for others. There are too many angles to this market thingy for any one argument to be absolutely right or wrong.
Just a question ( and this was going to be my one line post ) if they took away I/C's hourly updates, what would they replace them with....nothing?....suits me..
and if they took away the market depth screens.... what would they replace them with?...Course of sales?...I can hear the lads now, mumbling over their brandy and cigars about the need to keep some types away from the markets....namely...us.
Better to be flying with at least one eye open when battling the big boys....From what I have heard on the grapevine, some of the big boys put up quite an argument against allowing us mere mortals to access M/D in the first place......Still have to pay for it in the U.S I think.
Won't argue this point yay or nay, it's just my point of view thats all.....Cheers all....
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resillent1
Member
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