Smash, when you mention the above and then this "Understanding whether the market is in a state of balance or imbalance will drastically help in making better trading decisions." the main idea or objective is that it increases the probability of joining the Buying initiating activity., not looking so much for the Selling responsive activity in the case of the OTFU. Since we're looking for two-way auction movement, when we get out of balance, is the idea really to slightly change the way we view the profile to look for initiative confirmations?
Yes, that’s a good way to think about it. When we transition out of balance, the focus shifts toward identifying and joining initiative activity in the direction of the breakout, rather than fading it.
In a balanced market, responsive activity tends to dominate since price oscillates around value. But once we break that balance and confirm initiative intent (e.g., single prints holding, continuation volume, acceptance outside balance), the goal becomes to participate with that activity — until the auction finds a new area of balance.
''The faster the FUT is tagged during a session, the trickier it becomes to trade if you’re not already positioned, requiring a high degree of patience. I personally avoid these types of sessions, as I generally have no interest in chasing above the FUT, and at the same time, attempting to short a 5-week balance breakout is not ideal. There is always the next trading session.'' Thank you for sharing useful insights, Smash, appreciated as always.
Smash, when you mention the above and then this "Understanding whether the market is in a state of balance or imbalance will drastically help in making better trading decisions." the main idea or objective is that it increases the probability of joining the Buying initiating activity., not looking so much for the Selling responsive activity in the case of the OTFU. Since we're looking for two-way auction movement, when we get out of balance, is the idea really to slightly change the way we view the profile to look for initiative confirmations?
Yes, that’s a good way to think about it. When we transition out of balance, the focus shifts toward identifying and joining initiative activity in the direction of the breakout, rather than fading it.
In a balanced market, responsive activity tends to dominate since price oscillates around value. But once we break that balance and confirm initiative intent (e.g., single prints holding, continuation volume, acceptance outside balance), the goal becomes to participate with that activity — until the auction finds a new area of balance.
Perfect Smash, thanks for the explanation, every day 1% better, I really appreciate your education
''The faster the FUT is tagged during a session, the trickier it becomes to trade if you’re not already positioned, requiring a high degree of patience. I personally avoid these types of sessions, as I generally have no interest in chasing above the FUT, and at the same time, attempting to short a 5-week balance breakout is not ideal. There is always the next trading session.'' Thank you for sharing useful insights, Smash, appreciated as always.
Thank you Smash!