Trading with the Pride of Hunting Institutions by Revealing Block Trades

It’s the classic National Geographic special — the antelope innocently lapping up water at the edge of a pond one minute, and being torn from limb to limb the next. The pride of lions seem to be enjoying their dinner thoroughly.

An oblivious antelope who didn’t care to look around before letting its guard down is no match for a hungry pride of lions.

Every day, institutions lay in wait with massive positions ready to feast on retail traders just like you. With every move, they snack on easy prey that crosses their path, unaware of positions that they’ve taken.

Surfacing block trades with Order Flow Sequence Tracking Intelligence allows you to immediately spot the massive ‘pride’ of positions held by institutions. This intelligence allows you to hunt with them, stalking the same price levels, while everyone else gets eaten.

Trades you can’t ignore if you want to survive

Your average pride of lions will roam in a pack of at least 30. They usually roll with three adult males who weigh around 400 pounds and are 9 (or so) feet long, accompanied by a dozen females and their cubs.

While the adult males may do the roaring and defend the turf, you can guess who’s really in charge. That’s right — it’s the females who are usually the most active when it comes to the hunt.

Just like the African wild, it doesn’t take much to figure out who’s really in charge of the market. The institutions who handle 90% of the volume are the driving force, while millions of retail traders fight to survive.

When institutions are interested in a price level, they make their move. And when they pounce, they do it in a big way in the form of a blocked trade. Block trades are single positions that hold lots of contracts — usually several hundred.

Like a pride of lions lying in wait, it’s these positions you need to be aware of.

Spotting the waiting pride before it pounces

Imagine viewing a map that reveals the live positions of every pride of lions in the wild. As they move, you can know not only when but where. And when they’re eyeing prey you can stalk right alongside them.

For retail traders hoping to profit, this type of intelligence is critical, yet completely out of reach with lagging indicators. These signals don’t tell you what institutions are doing.

Order Flow Sequence Tracking Intelligence plots actual trades as they are made directly on your chart. Instead of looking at the same blank candles, the positions assumed within a candle are revealed in real time. This uncovers where the institutions are camping out and the aggressive moves they’re making — like big block trades.

Notice the dramatic difference between the two views and the real-time intelligence provided. Using a traditional chart, you would have to keep an eye on microsecond spikes in volume to even have a sense that a big play is being made. With Order Flow Sequence Tracking Intelligence, you see it as it’s happening.

Those price levels highlighted in blue, with the lines extending — those are where block trades with over 3,000 contracts took place. The ones highlighted in violet, with the lines extending — block sell positions also with over 3,000 positions.

Now that you know where the pride has camped out — you can make your move.

Hunting with the institutions by stalking their positions

When the pride makes its move to kill, everyone gets fed. Likewise, when the institutions make their move, you can profit as well by trading with them.

Block trades are not only a strong indication of interest in a particular price level, they serve as key points of intra-day support and resistance. With that much volume concentrated in a particular point, you can be sure that price will respond.

Once these large positions have been assumed, you can watch for price to revisit and then respond. It’s these positions and the resulting market reaction that you can profit from.

Check out the influence the block trades below had on the following candles as:
• Price respected the level that was established
• Other large players followed with positions at the same level
• The market responded and price went up

Spotting this, and making your entry with a long position that went with the institutions, would have rewarded you handsomely.

Avoiding the slaughter of your account

Many retail traders are lulled into believing that they can simply play price, regardless of the elements. They’ll lean on indicators to signal a move and assume positions completely unaware of the massive positions surrounding them.

This leads to inconsistent, or even non-existent, profits because the indicators being used are price-based and lagging. They don’t take into account the volume that precedes price, and as a result are late.

While retail traders are playing price, these block moves are driving it in their desired direction. Best to know where they are, and move with them instead of against them.

It will mean the difference between an account that meets its gruesome end by the pond and one that grows with sustainable profits.

Feast on profits while others scamper for cover

When lions hunt alone, they are successful 1 out of every 6 attempts. When they hunt in packs, they are successful over a third of the time. A pride of lions is not a force many (or any) animals in the wilderness mess with.

If your prospects are slim when taking on 30 adult lions, imagine your odds of succeeding when dealing with an institution in the marketplace. When block trades are surfaced, consider it an invitation to hunt with the pride — not against it.

Stalk the same positions and price levels they are by looking for block buy and sell positions with at least 250 or more contracts. Anything less will serve as a distraction that could conceal the real driving force in the market.

As price approaches these levels, know that they’ll serve as support and resistance. While millions of retail antelopes innocently lap up water from the pond, enter and make your kill.

Feast on the profits while everyone else runs for cover.

Noft Traders offers a Funded Trader Program. To learn more, visit their informational page at NOFT-Traders.com.