MarketDelta

[OzTrade]

Is anyone here using Market Delta software?
Is it helping you make better trading decisions?

In one of the recent posts Brett Steenbarger was mentioned and out of
curiosity I had a look and search of his website.
I noticed he referred to and in many cases used software called Market Delta?

The idea of seeing volume and if the buyer or seller is taking out the bid or offer and who is doing more at any certain time especially at critical price zones appeals to my way of thinking.

Market Delta seems expensive but it maybe a clearer way of looking at the market then again it may add more confusion to the already confused.

Hence I was wondering if anyone has tried or used this software and it's strategies to assist in making better trading decisions especially when trying to trade futures?
Has it helped?
or is it pointless and stick to price action?

 

[Timmy]

Re: Market Delta

The idea of seeing volume and if the buyer or seller is taking out the bid or offer and who is doing more at any certain time especially at critical price zones appeals to my way of thinking.

There are other softwares that will do this for you:

Investor R/T
Sierra Charts
Ensign
and more.

Most of these are a lot cheaper than Mkt Delta. Mkt Delta will give a 30-day free trial, though. You will have to pay for a live data feed.

More on this topic at this thread, post 19 onwards starts on volume at bid and volume at ask.

 

[OzTrade]

Re: Market Delta

Timmy,

Thanks, Curious do you use it successfully?
Do any traders find it useful or is it just another indicator?

 

[Timmy]

Re: Market Delta

I do use the volume at bid and at ask figures, but it is not as useful as I initially thought it would be. It is a part of the picture for me and not a stand-alone tool, if that makes sense?

Having said this, I use it on only one market, and I may be not using it well? I haven’t used it at all on stocks, for example, but it may be very helpful, I just don’t know anything about its performance on any other market. I only have experience with it on the market I trade. I have some thoughts on how it might fare in other markets, but without actually using it in other markets, its not possible for me to draw any conclusions (or, rather, any conclusions with any substance to them ).

BTW, I don’t think of this data as an ‘indicator’. I don’t think of volume as an indicator, it is a raw piece of data. Similarly, I think the data on how much volume is dealt at the bid and ask is not an indicator, it is just data. The data can certainly be manipulated to display as an indicator (you can do a stochastic, or an rsi, or a macd, or whatever on the volume at bid & ask data, depending on the software you use, these, to me, are indicators).

In all honestly, as with everything in trading, the best idea is to give it a try and see what you think. Market Delta are very generous in the 30-day free trial, I think.

 

[OzTrade]

Re: Market Delta

Timmy,

What market do you trade if I may ask?
I too would not use it as a stand alone tool but to confirm price action.

As mentioned probably most useful when looking at certain price zones where we want to take a position, it would be nice to see an increase in offers being taken out when looking to buy and vica-versa rather than nakedly jumping in to buy support when price looks to be supporting only to find that the sellers are actually taking control, hence a break of support and then follow through.

I use Fibonacci Trader with IB data, I wonder if Fibonacci Trader has a similar volume and bid ask counter?
Which do you use?

I have looked at Market Delta but can not seem to get it to work properly with my data feed? Spent a couple days trying to get it to work and currently awaiting a response from the support desk @ MD.

Hence this thread, I'm starting to ask my self is it worth the hassle? After reading your suggested thread it looks positive and I must continue to try and getting it working for the trial at least.

 

[alex keaton]

Re: Market Delta

As mentioned probably most useful when looking at certain price zones where we want to take a position, it would be nice to see an increase in offers being taken out when looking to buy and vica-versa rather than nakedly jumping in to buy support when price looks to be supporting only to find that the sellers are actually taking control, hence a break of support and then follow through.

Hey OzTrade

Check out Spark. The market depth visualisation tool provides this insight.

http://iguana2.com/spark

 

[Timmy]

Re: Market Delta

Timmy,

What market do you trade if I may ask?
I too would not use it as a stand alone tool but to confirm price action.

As mentioned probably most useful when looking at certain price zones where we want to take a position, it would be nice to see an increase in offers being taken out when looking to buy and vica-versa rather than nakedly jumping in to buy support when price looks to be supporting only to find that the sellers are actually taking control, hence a break of support and then follow through.

I use Fibonacci Trader with IB data, I wonder if Fibonacci Trader has a similar volume and bid ask counter?
Which do you use?

I have looked at Market Delta but can not seem to get it to work properly with my data feed? Spent a couple days trying to get it to work and currently awaiting a response from the support desk @ MD.

Hence this thread, I'm starting to ask my self is it worth the hassle? After reading your suggested thread it looks positive and I must continue to try and getting it working for the trial at least.

Oz
- the E-mini S&P futures,
- I use Investor R/T
- I think it will be worth the hassle, even if just to satisfy yourself that that it can work for you or not work for you.

What about yourself, what market/s are you interested in using it on? If one of the futures markets check out DTN data feed (www.dtniq.com/), they will give you a 7-day free trial, which can feed Mkt Delta. If the ASX, that Spark product looks really good (tks AlexK).

 

[OzTrade]

Re: Market Delta

AlexK,
Thanks, I think the Market Depth on Spark is different to actual traded volumes and counts of bid/ask traded volume and the footprint on Market Delta, though the information may or may not be interpreted in a similar form.
I must ask, are you using Spark?
Is it useful?
Do you use it in your trading?

Timmy,
I trade the SPI and TOP10 stocks plus the odd currency here and there.
All in the Oz timezone.
SPI and FX (AUD) primarily intra-day, looking at using market Delta on the SPI and FX intra-day positions if I can get it to work and if I think it is useful and if it does not creating more confusion.

All too often price reaches levels where I want to trade and stalls, I'd love to know if the larger participants are distributing or accumulating contracts hence looking for that sort of information.

Thanks for the assistance.

 

[OzTrade]

Re: Market Delta

Timmy,
It appears DTNIQ does not support Ozzie markets? hence no ASX or SFE?
I checked website and the Oz markets are not there?
Mmmmmmm
If that not correct let me know?

 

[Timmy]

Re: Market Delta

Timmy,
It appears DTNIQ does not support Ozzie markets? hence no ASX or SFE?
I checked website and the Oz markets are not there?
Mmmmmmm
If that not correct let me know?

Ah - no, think you are right, no Aus mkts ...

Hopefully Mkt Delta can hook up with IB data, if not ESignal is the alternative I suppose?

 

[Broadway]

Re: Market Delta

I look at bid/ask volume quite a bit.I have IB and sierra chart.
Here are some of my newby ramblings/thoughts.
First problem is that as price falls to support, it is then 'absorbed' by pros who have placed limit orders at a certain price, so what you get in a falling market is 'bid volume' not 'ask volume'. And bid volume may be the only volume you see in a fast 'v' corner.
This goes a little against what I think market delta are trying to tell you which is that people will hit 'buy at market' when you get to a trough, and hence bottoms appear as 'ask volume'.
So volumes at major corners or retracements can be bid or ask volume, which means you will see mixed results from market delta, especially if the details are hidden in 1 minute bar charts or greater.
Second problem is that you are assuming the chart you are looking at has a correlation between its volume and its price, say on the corners. Imo, the spi is an example of volume being sometimes absent on major corners, because its volume is not what is influencing the intraday spi price(most of the time).
What influences the intraday spi is very multifactorial, from asx to asia to commodities to US and currencies. And episodes of large trades that look like a perfect corner or retracement often dont turn out that way.
I think market delta was designed for highly liquid and fluid markets like the ES where some of those experienced market delta users may get an edge, but it might take lots of practice, and in the end it would be 1 factor in many in deciding when to trade.
Having said that, I think there can be some great opportunities given by splitting volume into bid or ask, and also watching in high detail the trades coming into the market on minor peaks or troughs.
Ill give a recent example of it not working and working.
Here is BHP at the recent bottom we had on 2nd, 3rd, 4th sept.
On the 2nd the volume's a little confusing but on the 3rd and 4th you can see the 100,000 share trades on the dips in the stock and predominantly at ask volume. The 3rd and fourth made me wonder if we were 'bottoming' at the time. BHP volume is quite a good way of picking hods and lods in the spi, but you gotta watch asia, it can sideswipe you. Also another hint is that strong volume lods in Asia/spi/bhp can mean an up night in europe/us, but you may have to wait all night to take the profits.
Hope this helps a little.

 

[OzTrade]

Re: Market Delta

Broadway,

Thank you for your thoughts, points well taken.
Interesting concept watching BHP volume.
I think there are set-ups and areas where the Market Delta maybe useful.
As your probably aware there are certain trading area’s/zones where the SPI tends to get caught in side-way action, normally 10-12 point ranges and goes sideways for a while.
I’d like to know while this is occurring if the larger orders and traders are accumulating or distributing contracts?
In theory for any up trend to continue new buying must enter the market, hence if there is an absence of buying, support zones should in theory fail.
Based on the fact that the seller is being more aggressive and moving down to the bid?

If support zones have a positive Market Delta and still fail I would think these failures are better trading scenario’s and these are places where I’d like to be short because all that bought must need to get out somewhere? As the failure continues? Or until a positive Market Delta appears.
It is these type of price zones that I’m interested in trading and where I think Market Delta maybe useful?
I’m sure you’ve seen what I’m talking about?

The other place of interest is where the market has good volume supports and then has a fake drop through support, as if the buyer has just taken a quick break and let the market fall in order to get set at a better price and then comes back in and drives the market higher?
I see this all the time in the SPI, especially late afternoon between 3:30 and end of day session.

If I were trading for an institution and had large orders to fill I’d probably be working within a price zone. Obviously for me to get filled another larger trader would need to be selling down to me, if I were more keen to buy I’d probably move up to the offer more times than I’d be getting hit on the bid?
Every now and then I’d take a break and let the market drop to test the water, if others were keen to buy I’d obviously need to be taking out the offer to get set hence creating a positive Market Delta in theory?

Your probably right and it maybe a waste of time but I’ll persevere to satisfy my own curiosity.

It appears I maybe the first to try Market Delta on the SPI as MD support tell me that they are having problems with the AP contract data feed from IB not being recognized hence it will be fixed in the new version.

If anyone is using Market Delta for the AP contract with IB feed, please let me know the fix otherwise it appears we’ll need to wait for the next version.

 

[Broadway]

Re: Market Delta

I think you've got some good ideas there. I hope you can get it to work.

I think one thing to consider is whether trades made on the spi intraday have anything to do with the short to medium term future price of the spi.

Sometimes the spi will move because the bhp, asx, nikkei, hsi or k200 is moving, and hence price has nothing to do with its own trades/bid-ask volume, and hence nothing to do with its own delta readings.

I think market delta relies on percentages, across a large numbers of trades(like what the ES would produce).
Im not sure if the spi has enough trades to generate meaningful percentages.
Here's the spi on a 1 tick/1 trade chart with bid(pink below)-ask(green above) volume. Just as an example to illustrate my point.
But I think its worth a shot to try. Just dont give them too much money.

 

[OzTrade]

Re: Market Delta

Broadway,

Once again good points.
I always thought the futures followed the stocks and other indexes and for many years tried to trade them that way.
Over the years I have learnt that it maybe the other way around, due to the huge leverage gained in futures and also market participants hedging there long stock positions with shorts in futures and vica-versa, hence I treat each market as it's own though I do keep an eye on the other major indicies and major stocks, after all it is the ASX200 Futures.
At the same time I watch the US market closley too as they do have similarities most of the time, but one must be careful as they don't allways mirror each other and one often leads the other to some extreme.
Your chart is interesting however I would not be looking at one or two ticks or trades, my idea is to look for the blocks, hence maybe use range bars and watch what happens within certain ranges and watch to see who dominants control if any and where the divergence occures etc.
For example this morning in the SPI and to this minute the SPI is trading a very tight range of 4608-4584, I'd like to know if within that range there is dominance from the seller or the buyer?
If it is the buyer I would look to get long off the lows or mid-points and expect a break upwards later this afternoon. If not I may stay out.
I believe it would add another dimension to my trading.

I'll keep you posted on this thread if I can get it work.





however your chart is interesting

 

[Trembling Hand]

Re: Market Delta

For example this morning in the SPI and to this minute the SPI is trading a very tight range of 4608-4584, I'd like to know if within that range there is dominance from the seller or the buyer?
If it is the buyer I would look to get long off the lows or mid-points and expect a break upwards later this afternoon. If not I may stay out.
I believe it would add another dimension to my trading.

Its completely irrelevant who is hitting the bids or ask in this type of price action.

 

[OzTrade]

Re: Market Delta

TH, Your probably right, however wouldn't it be beficial to see a positive MD at this afternoons lows (4593-96) and assume the market is holding support hence a good place to get long?
And of stopped out due to the market falling knowing that it should continue lower due to the previously high number of longs at this afternoons support levels?
Or maybe seeing a negative MD at this afternoon's highs maybe gives us an indiaction that if we break support it should go lower tonight?
Just thought it make sense?
Maybe it don't matter at all as you say?
I guess I'll never know unless I check it out?

 

[surfziggy]

Re: Market Delta

Its completely irrelevant who is hitting the bids or ask in this type of price action.

Why is that? Because it is range bound it tells us that there is equal pressure in both directions? Or something else?