Quote:
Originally Posted by timbo82884
It seems that the level 2 quotes move extremely quick. What kind of imbalance should I be looking for in order to place a trade based of differences in liquidity on the bid vs. ask?
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I start with just 4 levels of Market Depth and I look for a steady (30 seconds to a 60 seconds) of a 2 to 1 ratio. I set a 10 pip limit and a 40 pip stop with 1-click in the trading mode as these moves are quick. Depending on market conditions, I can be out as quick as a few minutes to an hour. Sometimes the imbalance flips while I am in a trade but I do not do anything to my position until the limit is hit or the stop is hit. I stick to pairs with small spreads and deep liquidity like the EUR/USD and the EUR/JPY
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