Russell 2000 Order Flow: Bullish Pattern ActivatedHey traders,
In today’s analysis, it’s hard to ignore IWM following the 🚀explosive🚀 8%+ move up.
Let’s unpack the action as of late via the OFA script :
To do so, I am NOT going to apply any subjective type of analysis such as crawing trendlines, counting waves based on what way the wind blows, or any other form of guessing…
Instead, we let the formation of fractal structures (an objective measure of moves) create the pathway from which we can all make decisions.
Fortunately, there is no need to engage in laborious manual work. Why? The OFA script has all of us covered. So, with that in mind, what can we observe in the IWM market?
What recurring pattern do you notice? Clue - Pay attention to the visual CIRCLE feature in the last leg.
These patterns entail, “dynamic fractal-based order flow cycles where a decreasing involvement in one direction (depicted by cycle/wave/line counts) is followed by a predictable move in the opposite direction with greater commitment seeking out the next equilibrium area, in most instances, with potential profits as a by-product thereafter…”
If you are into disseminating order flow, nothing I’ve seen beats the objectivity in analysis one can carry out via the formation of structures derived off fractal structures.
So, how are you going to profit from the latest pattern printed? I know how I will...
Remember the two key main features of the OFA script:
Magnitude: A major clue that will help determine the health of a trend is the type of progress by the dominant side in control of the trend. We need to ask the following question: Are the new legs in the active buy-sell side campaign as identified by the script increasing or decreasing in magnitude?
Velocity: When it comes to the distance the price moves, the magnitude is only ½ the equation. The other ½ has to do with the velocity of the move or the speed. Was the new leg created after a fast and impulsive move? Or did price make a new low or high with the movement being sluggish, compressive and taking too long to form? A good rule of thumb is to count the number of candles it took to achieve a new leg.
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