<aside> <img src="/icons/row_gray.svg" alt="/icons/row_gray.svg" width="40px" /> What is Institutional Order Flow / Propulsion Block, BPR and OB / When to expect Stop hunts / When Breakaway gaps stay open / 14:50 - 15:10 PM Macro / Amplified Tape Reading
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Depth of Market (DOM) doesn't make prices go up and down. The only thing really you're doing is watching the orders that are coming forward on that display. They can be spoofed. Spoofing is where an order is placed above or below the marketplace and pulled away before the market prints it, and it will look like it'll make it look like there's more buying or selling interest in a particular market. So how would that be any more advantages or different really for a Trader that has to sit down look at the market and determine it's going to run from where we are right now at the market price to some previous support level so what you expected to go lower or is going to go higher to some previous resistance level. You're still met with that same challenge of knowing where the Market's going to go. But using the DOM you try to predict if price will go to:
🎣Its more likely, not 100%, that price will go to the larger stack of orders.
This is not institutional order flow. This is reporting numbers that can be pulled. That means that you may see them flash on the screen but doesn't necessarily mean when price gets to it that those orders are still there. Many trading firms and quote-unquote institutions have been fined many, many times over. Some of them are repeat offenders.
I have nothing on my chart, it's simply a Candlestick chart. And all you need to see is what time it is and where we are in the range. That's it, that's all you need. And the number one thing is the Draw on Liquidity.
👉Mitigation block is basically the opposite of a breaker but they are still both mitigation in essence.
Bearish Breakers are much stronger in terms of resistance than a mitigation block. A mitigation block can be traded through. We typically use them as targets more so than entry because they can be traded through. Breakers are like formidable obstacles in the path of price action. It doesn't mean that you won’t have a losing trade with a breaker. Mitigation blocks are better used for targeting purposes.
We are not calling a high, and it's important for you not to try to do that too. The market just keeps drilling higher, grinding people down anybody that wants to sell short this market. There's no justification for the markets to be where they are, at least for equities. Your stocks should not be trading where they're at, but we have to trust order flow.
Propulsion blocks are order blocks by themselves, but the way you differentiate what they are and how they're used is this: a down-closed candle digs into a previous down-closed candle. So, an order block that has another order block that digs into it.
You never want to see a closing price below mean threshold. Price can wick through it, but not close.
Let’s look at the tail of that PB. We know that wicks and tails are gaps. If we pull the C.E. of that tail, we can see how price traded off of it on Monday which initiated the run up.
The movement that followed was fully expected. We are expecting bullishness and higher prices on NASDAQ, as well as S&P. We look for things to start or instigate a price rally higher or a price decline lower. We frame it on the basis of where we are right now versus where it is likely to go. If we think the price is going to gravitate up to a certain level, say Mitigation block, then we expect each daily candle from Monday to Friday to gravitate towards that level.
Even if you didn't pick that specific level, if you feel that the fair value gap was a reason to keep going higher, that's perfectly fine. The mitigation block is below that for FVG, and if you are using the relative equal highs as drawing liquidity, there's nothing wrong with that either. Remember, the primary goal is to look for expansion either higher or lower on the weekly candlestick, which sets our bias for the week.
So, is it more likely to see when price was consolidating and then drop down after we've already gone into the Daily FVG? We already did that and then we consolidated here the previous week. Then, we start a new week, trade down a little bit, and then reject it, which is all that rejection is based on this C.E. of the daily PB tail that formed the low of the week. This sets the stage for the price to expand higher and aggressively above these relative equal highs on the daily chart.