Probing a market is very beneficial when done at the correct times and gives a birds eye view of the current health of the market in that particular area.  The correct times to probe are during wash outs or when a trader believes a market is being taken over by sellers or buyers. This is often done by large traders to get a read on the market but is rarely if ever discussed.

How to Probe: If a trader believes a market is taken over by sellers and that the market is about to dump off a cliff he should fire a couple singles off as market sells. Sending a sell market will instantly send a order looking for the nearest resting buy order and if this order is 5+ ticks away from where it was  submitted this shows  that there are very few buyers in that area.  Once this has been discovered a trader can now put on size and know he will be one of the last sell orders filled. From here it is only a matter of time till the manipulator will throw size at the market to crack it for the run of the cliff.

Again this can be used in many different situations but gives the best view of supply and demand and also keys you into the order book showing the fake side.

 

Happy Trades

Tags: area, birds eye view, current health, manipulator, market, Supply

This entry was posted on Thursday, August 18th, 2011 at 8:34 am and is filed under Uncategorized. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.

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