Formation of "triple bottom"

Effective trading system:

Effective trading system, which gives a steady income for a long time, even if the author is usually based on certain principles that are universal. As a rule, it is a technical analysis and synthesis of the analysis. Now let's consider the elements of an effective trading system and what aspects should be paid attention to when carrying out market analysis.

This or that trading instrument schedules studying the main attention should be paid to the areas where the major players have opened positions (which clearly shows the large sums of money to those in the market, which is revealed only in volume), as well as no less interesting is the area where the major players closed at their positions (withdrawn from the market, which AAR Month is well reflected in the volume), according to the zones stop obstructing the movement of the price schedule for certain destinations.

In general, it is believed that most of the market represented by the small, so-called Retailers, which in most cases lose their money in the market, lack of trading discipline, emotions, if capital mismanagement. In addition, market players operate large (Market Makers), who mostly work against retailers. As is well known Stock Exchange according to the agreement, Market Makers task certain levels of liquidity provision, which for example means that when you have a strong downward trend and traders in the main mass of the public has a short position, it is necessary that a counterparty, which will allow the retailer to open a position on the sale. That's the role of Market Makers, accordingly.

So naturally, this event has the other side, when the bulk of the sales in the market receive certain level due to the Market Makers and its limit orders by retailers sell market orders to buy back from the market, after some time the market will create an imbalance on the side of the buyers and the price will start to move upwards and retailers will be forced to close their positions and thus further increase the price move. This is the largest player in the market and the logic of any effective trading system must take into account this fact and trading algorithm built into these factors.

It must be said that the major players in implementing such actions only, and only the strong consolidation zones, which previously has been accumulated huge liquidity and therefore occurs in the zone of protection, this is the case, if the market remains the player to the liquidity of the vote, while in the case, If a player has passed out of the market, then the balance of the balance will be easily accessible by the price.

Therefore very large if not crucial to find out how strong, or that accumulation zone on the chart. Before we make any decision, it is necessary to find out the following things:

·         If the player has not a large position in a given range;

·         If the balance is not a major player in the open area of ​​interest (open positions);

·         Did not the major player in this area accumulated Distribution position and whether the area is empty.

·         If they are not in the zone compared to the major players, who have not been heard from their positions and the stop orders are expected through the correction phase of the launch, to leave unprofitable positions.

Hence it can be said that an effective trading system is one of the cornerstones of the rate of accumulation zones and their analysis.

To do this we need to know: Exchange of different orders with each other rule, the largest player in the market logic of action, double the market as the auction process and the need to understand the three technical indicators, chart clustering, a vertical and horizontal indicator of the volume of the volume profile. In addition, if necessary, we can use the cumulative rate of the delta, which shows aggressive valiant and aggressive seller to enter the market.

Consider a specific example. Take the well-known euro futures.

As can be seen from the picture below, a few days the market has developed a downward trend.

Figure 1 - the largest player in the accumulation position, the movement of a trend change

But after the price reached a certain level, the market was a major player and limit orders by purchasing the small players with great liquidity; it showed an increased tendency of the end plugs and the plug out of the increased vertical extent.

All this exposes the cluster diagram that shows where we are located and what level is the largest player in the big orders.

Figure 2 - The big players in position by accumulation, cluster chart

Since, after the big players accumulate huge lot which took the price upward, thereafter began to win the battle, which automatically means selling some amount of retailers to retailers who have seen what the trend direction has changed and decides to open a position to buy and it did at the peak of the current trend.

The price came down and logged on to buy the small traders are driven out of the market, as it was their stop-loss orders to activate, which is nothing if not a market for the sale of warrants.

It is still used by the major players and their limit orders purchased from retail traders liquidity and has the additional position of price again took the top.

Figure 3 - the largest player in the accumulation of additional liquidity

As a result, set up an interesting situation, until now, the largest player in the position of the cumulative average price of 1.15110, above which the price movement of the major players taking profits, additional liquidity After the addition, the overall average price of the position changed

Figure 4 - the largest player in the average price of the position after the initial accumulation

The average price has moved above and it was 1.15470, the additional position of accumulation. As a result of the major players in the extra profit, has been since the price level continued to rise and overcome.

Each new price trend in the direction of the movement and accumulation of large players who earned the top position and the average price goes up, which indicates that this trend continues.

Figure 5 - the largest player in the position of additional accumulated average price

Figure 6 - POC level through their position on the open sale

Finally, there is a moment when the accumulated value of the average position, POC level price breaks and begins to accumulate the level below. Before we can see on the chart, the price of accumulation zone came out against the position which indicates that a large buyer and the level of protection is no longer likely to set out its position before the full distribution of accumulated retail traders, and came out of the market. This will mean that we can open a position in the stock.

As you can see in the market analysis tools and the theoretical training can be an effective trading system development and its successful application in practice.