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Price action is "it". Everything else is secondary. Sounds simple, but its ridiculous how often it's forgotten. PPM - Price Pays Me. A rally on weak volume with no interest from buyers that hits resistance left right and center is STILL a rally that pays you if you were long, and gives you a loss if you were short.
Studying anything - VSA, tape reading, etc. - needs to be referenced in context to which MARKET we are talking about.
When you read the tape, you are analysing what other traders have DONE.
When you study the depth of market, you are studying what you THINK traders are ABOUT to do.
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Man, you are sooo right about these points. So many people are caught up in technical analysis (of which 99% is myth, stupid conclusions and wrong interpretation) that they can't see the simple truths of trading. Great post!
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The DAX has every man and his dog trading it - retail guys across Europe and America, big funds, automatic trading, the lot. In my opinion, it is a very good candidate for reading price action. I like to know my S&R levels, and then "live in the depth" of that market, and glance at the chart occassionally. |
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I disagree, if you want to trade the
DAX, look at what the Dow Jones Euro
Stoxx 50 is doing since the
DAX is following it "tick by tick" (each tick in the Dow Jones Euro
Stoxx 50 moves the
DAX by 4 - ticks on average - 0.1 seconds later). Just watch the DOM of both side by side and you'll see it.