Master Order Flow Trading in under 30 Minutes

We were able to read the data inside of the candle. So, we were not only focusing on the price, but we were also focusing on the buyer and the seller participation inside of this scandal. >> Most traders look at the candle. Somia looks at what's inside of it. She is back for part two of her orderflow strategy breakdown. >> So, this is a sign of absorption. It is the best to actually take trades after you see a sign of absorption. That's when you know that your chances of getting stopped out are very less. Somia is a futures trader from India who has six figures in funded trading and uses footprint charts, volume profile and absorption signals to find the highest probability entries on the market. Before we start this episode, I just want to let you know that you could have had access to watch this video day earlier if you're a member of Way on Plus and you get to see the full extended versions of these episodes. So, if you want to check it out, link is in the description below. Welcome back to another episode of Strategies. If you're familiar to the channel, you probably know who this is. This is Somia. She's a futures trader from India who's been trading the last four years, has been trading orderflow for the last two years. She's six figures in funded trading. And uh yeah, you guys want to see a part two of order flow. She explained it really well. Some of you guys said she was one of the best explainers of order flow. She made everything sound simple. So, we're going to dive into more of her orderflow strategy. Kind of refresh for those that don't know what orderflow is. We'll go over kind of uh the simplicity of a strategy, go more in depth of terms we didn't go into last time, and then break down trades of course. But Somio, welcome to the show. Thanks for being back on again. >> Thank you so much. I just love doing this, and I'm glad that a lot of people enjoyed the last one. So, yeah, I'm looking forward to this one. >> Cool. And if you guys do want to watch that previous episode, watch it after this one. But yeah, let's dive into it. Let's get a refresher. Maybe for people who haven't watched the first episode or even for me I haven't talked to you in a long time. What is your strategy in a nutshell? >> All right. So I'm just going to go over what we saw previously so that because we'll use a lot of that information in this one as well. >> Yeah, >> we spoke about footprint charts. We spoke about two kinds of footprint charts. We had a green color footprint chart and we had a red color footprint chart. >> Mhm. >> The interesting part which we saw was that we were able to read the data inside of the candles. So we were not only focusing on the price but we were also focusing on the buyer and the seller participation inside of this scandal. And then we saw about delta. Do you do you recall what delta is? >> Of course delta. >> Okay. So when the delta of a candle is green that would mean that the buy contracts were more than the sell contracts in this particular candle. >> Mhm. >> And uh when the delta was red that would mean that the sell contracts were more than the buy contracts. M so that's what we spoke about and then we were really talking about um the entry confirmations the entry models let's go over how we can actually mark those zones today because location is the most important thing this confirmation does not matter if you do not take the trade from the right place the right location. The first thing to do is obviously location and then we were talking about this confirmation and if we have a supply area or a support area sorry uh anything supply support demand whatever zones you have >> order blocks >> order blocks liquidity >> call it what you want essentially they all mean the same thing um let's say that this is a demand and we have a green color footprint chart >> and of course uh I know you mentioned this is not the only confluence in your strategy. You also use like uh supply and demand zones and volume profiler to combine uh footprint charts with it. So yeah, let's get into that. >> Yes, I mean uh footprint chart is the best confluence out there, but I do have other tools which I use uh which just give me more confidence in taking a trade. So let's just the last thing let's just revise what we saw. We have a demand area and let's say that on the demand area we have a green color footprint candle and let's say that it had a negative delta. So that meant that the price went up despite having excess of sell contracts that meant all these sellers were trapped. So this is a sign of absorption. >> I see >> this was a confluence we spoke about and then we were talking about the supply areas. We had a supply uh we had a red candle and the delta of the red candle was green in color which meant that this red candle actually had excess of buy contracts despite that the price still closed bearish. That's the way you read it and not the other way around because a lot of people get confused and they're like >> um the price went down but the actual picture is here so actually buyers are strong but that's not how we have to read it. Always give priority to the price. So this is a sign of absorption >> and it is the best to actually take trades after you see a sign of absorption. That's when you know that your um chances of getting stopped out are very less. >> Okay. So we get using footprint charts with supply and demand zones. I guess uh refresh me on where you mark your supply and demand zones because I know you like to use a fivem minute one minute chart to enter your trades but you also do use higher time frame analysis to kind of get an overview of the market. So are you drawing like 4 hour supply and demand zones, one hour or you marking on a specific time frame? >> You need to use a time frame which is the best for you. But according to me, I like to go from the highest time frame and then I move on to the lower time frames. But regardless of that, the main zones I'm usually focusing on are actually drawn on the 5minut time frame because I personally believe that the volume profile works the best on the 5minut time frame. It gives you clean zones. But in order for me to actually create a bias whether I'm going to be looking for longs or shorts, that's when the higher time frames come into play. >> Okay, that makes sense. That makes sense. And with volume profile, I know people use uh the different value areas and PC to take trades from, but you're just mainly looking for high volume nodes with supply and demand zones in them. >> Yes. So I don't use the VH value area highs, lows. Uh I just use the P and the high volume nodes. So we understand how you're using footprint charts with your supply and demand zones. Uh now how are you utilizing the volume profile? >> All right. So that's actually my favorite tool to use because I love volume profile and um again you can use it on any time frame but I would say stick to the 5m minute time frame when you're drawing the zones >> and there are different ways to actually draw it. The best way to actually go about it is if there is a trend like this, pick up the low and the high of a leg. Pick up any impulse leg or just any big move. This is also correct. If I pick from this to this, that's also correct. Of course, it's very subjective. You can u pick whatever you want to. Now, what I like the most about volume profile is I want the high volume area to coincide with a demand area. M >> you call it an order block untouched demand. So um different names for the same things. So I would draw my volume profile from this area to this area. And then the volume profile basically looks something like this. Like it could be something like a bell >> perfect balance. >> Yeah, this is like the perfect one. >> In this case, in this example, I would just say that this area is going to be my high volume area. What does that mean? That just means that this entire price area this is the area where the maximum amount of participation happened right so this is a good interesting area for me to take a trade from >> so yeah that's what it is but of course you don't have a perfect um bell curve when it comes to uh volume tools any volume tools you use so it can also look something like this so you have some uh volume peaks and here there is no volume but you know that this is a volume area. This is a high volume area. This is a high volume area. >> So now I want the price to let's say the price is trading somewhere here. I want the price to come down all the way to this area. Now this is my area of interest. >> I want the confirmation to happen on this area and then I'll take the price higher or it could do this. It could also come and react from this area or it could come and react from this area. Another thing is if you have a volume area and let's say that the price did not respect it. >> Yep. >> And it broke below it then change in polarity just like any other form of supply and demand. The same high volume area is now going to act as resistance. >> Yep. Yep. Break and retest. Basically >> break and retest. It's the best thing. Break and retest really works of volume areas of supply and demand of fair value gaps inverse fair value gaps. That's the way I use volume profile mainly to mark my zones to mark my supply and demand. >> And I noticed that you're marking it from like a swing low to swing high. >> Yes. >> Do you also mark you know your volume profile in ranges like session ranges? >> I used to do that when I started off with order flow but now I think that I've trained my eyes in a manner that I like to manually draw it from the swings. I think >> cool. I think that makes a lot of sense. I guess one question I have for you when looking at this drawing you made here is I'm assuming the audience have the same question. When you're waiting for a retracement back to one of these high volume nodes, how do you know which one to take your entry from? >> When the price reaches this area, I probably have set an alert on my trading view. I wait for confirmation. And like we discussed earlier, I will not be taking a trade until the footprint chart confirms. >> Probably if this wasn't the right zone, then the footprint chart wouldn't have confirmed and you would have saved yourself from losing that money. Okay. So that's a conf you're not you're not just setting limit entry orders off these like you're waiting for extra confirmation then to take that trade. Okay. >> Yes. I'm waiting for a pure B shape on footprint. I'm waiting for delta divergence. I'm looking for absorptions and then I'm entering. If that doesn't happen here then I wait for this zone. >> Same thing. If that doesn't work there then you wait for this next zone. >> Yes. >> Okay. >> And uh one more thing uh before we actually hop onto the charts. Um how can you actually mark the volume profile? A lot of people have questions. Again, it's like you remember when we started using the Fibonacci retracement, >> it was so difficult for us to use it. Do I use it from this leg or the micro leg? So, I get it. It is subjective. It's a little bit confusing. So, I just want to give my rules which someone else can follow if they're facing any trouble. >> Mhm. >> The first thing would be from the swing low to swing high. Swing low and swing high >> on the 5minut chart. >> On the 5minut chart. Yes. >> Okay. >> That's one thing. Now the best method if I mean I would just say that start off with this then you'll slowly get the hang of it. What I do is leg in and leg out. That just means that you have an impulse let's say an impulse move down. Impulse move just means like a big move maybe left a lot of gaps imbalances whatever we have a move here and then price was consolidating here and started going up. >> Yep. >> This is my leg in this is my leg out. This is my balanced phase or my consolidation. So I'm going to mark my volume profile from here all the way till here. So when I do that, my zones get drawn in this entire area. >> Right now let's say it's something like this. Then I would wait for the price to come here and take a tra trade from that area. >> And can we see it? Of course uh the opposite is just reversing that. And then can we can you can you draw example of the continuation? So um this is a leg in leg out. We got that. And then the other thing is of course the opposite of this. We have a leg in impulse move up consolidation impulse move down. In this case you would draw the volume profile from the leg in to the leg out and then you get your zones. So these are basically uh you can call them reversals. Now we also have one more thing. We have a leg in consolidation and leg out. In this case, you draw from here to all the way till here. >> And again, the opposite is leg, consolidation, leg out. You draw your volume profile from here to here. >> Simple as that. >> Yes. >> I'm I'm assuming we can also break some of these down on the charts as well. >> Of course. Of course. Yeah. I'm just uh I had this problem that when I was using the volume profile, I was so confused about which points do I use? Do I zoom it out or do I zoom it in? I was so confused. So, this is how I use it now. And I hope this just simplifies it for whoever wants to get started with volume profile. >> Cool. And do you suggest too cuz I know you're doing this strictly on the 5 minutes. Let's just say someone prefers to stick to maybe the 15 minutes for the entries or 30 minutes. Can they just stick to the time frame using the same strategy? >> Yes, they can. I mean this is order flow. Everything is fractal. Price action is fractal. You can use it. You can even swing trade on the same strategy. But I like to use the five minute time frame. >> Well, I think that uh explains everything here. We can hop on the charts, go more in depth. >> Uh before we actually go on the charts, let's just discuss one last thing. Let's just talk about P. >> Do you know what PC is? >> Of course. Point of control. >> Point of control. People don't have an idea of it. It's basically a line which is drawn on your volume profile. It could be here, it could be above, it could be below. So what do you think this is though? >> I'm very very aware with a PC now. So basically point of control is uh the level where the most transactions took place. It's where the most uh volume is. So it's the tiniest pinpoint line. It is an area but it's the highest uh uh node on the on the volume range that you mark. >> Awesome. So that's what it is. Point of control is literally what it means. Point of control. The area where the maximum transactions took place maximum volume. That area is also an important uh area for us. For example, let's say you are already in a trade. You're coming down. Let's say you're in a short trade. M >> if you are confused whether you want to book your trade or not if you see it approaching the P then that could be a good area for you to actually trail your profits >> you can use it like that because essentially that's what P means that some big player did step in at this particular price point now that price is reaching that area again they might do it once again so uh it is important for us to mark the P on our charts and just know where the PC is. >> Makes sense. >> Yes. Now we can go to the charts. >> Let's go to the charts. Hey guys, it's Hunter here. I just want to let you know that Wayon has released a new channel called Wayon Live where we do live trading every single day, Monday through Friday for New York session. If you guys want to come trade with us, get a clear bias for the day, ask any questions, check the link in the description below. Now, let's get back to the video. All right, so I mean, now we're on the charts. We're on Trading View. Let's see some more examples, I guess, of how you draw your volume profile from leg to leg. >> Let's get started with that. Before that, I'll just show you the settings of my volume profile. >> Okay? >> So the users can just copy it. So you just go here and uh when you go on the volume based tools, you see something called as the fixed range volume profile. That's what we're going to be using. And when you just plot it on the chart somewhere, you're basically able to see something like this. If it's confusing right now, just hold on. We'll break it down. And when it comes to the settings, go on rows. It's always text per row and not number of rows. Pro size is one. Volume is up or down. Value area volume is 100. I have my PC ticked. >> I don't have anything else. I think this one I'd like to keep my chart simple. So I have these unticked. That's a little bit about the settings. And this is how the volume profile looks like. Let's just look at this. Right now I just plotted a random volume profile. The highest volume is here. This is the area where we have the highest volume. And then we also have this. And we see that here there was no volume. So this is a low volume area. We see some slight volume here. But if I compare it with these peaks, then this is actually nothing. So I like to focus on areas where the volume is the highest like this. And let's actually see how we can draw it. Let's actually go here. Now do you see an impulse up move here? >> Yeah. We have like a very big green candle and we see the price going up and then suddenly someone stepped into the market and took the price down right and before that we did have like one candle like this. So what I would do is I would take my volume profile mark from this is where the leg started. I would mark from here and this is where it ended. Right? So I would mark this and then I would wait for the volumeing profile to be drawn and you can see that the maximum volume was actually here. So just mark it and keep whatever you think is a good area mark it. And if other than this if I want to know an area where the price would potentially retrace to and go down from then I would mark this area because after this I would say that's like the highest volume area and like this entire area too. And you can let's just randomly see what the price did. Price went it was rejecting this exact high volume area and then started going up. Now here's the thing. Whenever you're drawing volume profiles, you need to be very careful about what is the leg in that you're choosing and what is the leg out that you're choosing. Now, just because this was a high volume area, that does not mean that the price will just go uh touch it and start going down. It's not necessary for the price to do that. It can do that, which is why we use footprint charts for confirmation. If you would have just looked at this and if you would have placed a short trade somewhere over here, then you would have probably gotten stopped out. >> Yeah. So you set an alert here at these areas and then you go on your footprint charts and see what the footprint charts is doing in this particular area. >> So that's that's what we do. So in this case again I would use the leg in started from here leg out ended over here. So I would draw this and the highest volume is this. >> Now if you actually connect it with what we learned last time you remember the P shapes and the B shapes we got. Isn't this >> Isn't this very similar to the P shape? >> Yeah. >> Like that's what it is, right? Even inside the footprint charts, we were actually able to see the volume profile. That's what was the shapes we were talking about. So, this would act like a good resistance. Let's just see what the price did. And now you will see that the price actually came retraced just this much. It did not go to the best possible zone. It does not need to go to the best possible zone just because we marked it. Who are we? Like just because we mark it, it doesn't matter. Yeah. >> But you do you see where this pick actually reacted to? >> It reacted. >> Another high volume node. >> Another high volume node. >> Not the highest but second highest. >> Not the highest which is why we usually just mark this and then we don't mark these areas but that can happen too. And another interesting thing is there was also an imbalance leg out. You could see that market left a lot of gaps in the middle when it was going down. that shows the strength which is present in the market. That shows that someone really wants to take the price lower. So you could have taken a trade from there. A lot of people also use the volume profile something like this. If you don't if you're not comfortable with the idea of the leg in and leg out, you can just go here. You can mark the swing high to the swing low and that would also actually give you the same piece of information. >> Now this is the high volume area. That's like the highest volume area. Now another interesting thing whenever a volume profile gets broken to the other side it changes its polarity. >> Yeah >> earlier what was acting like resistance might now act like support. What was support earlier might act like resistance now. So that's also something um important and I am using the 5m minute time frame. I think that the volume profile works the best on the 5m minute time frame. Other time frames are cool too but this is the best thing. Now even if you would have marked something like this from uh this low to this high then um you see that this is a high volume area right I just uh used the swing low to the swing high >> and uh we can just mark this entire high volume area and you see that the price came here and rejected the same area multiple times and started going up. Now the point is if you stick with the candlestick charts you might have entered here got stopped out again you would have entered you would have gotten stopped out again again you would have entered here you stop you got stopped out here by this time you've blown your accounts you don't have money to take a trade anymore that's what I um I'm really talking about is that instead of getting whips and getting into these trades how about you use the footprint charts and wait for the confirmation on it at this exact area >> then what happens is that you might have not gotten an entry here, here, here. Your only entry would have been here. So that saves you about 3%. >> That's where the footprint charts come in. >> Yes. >> Yeah. >> So you mark the zone. You are right when it comes to your bias. You are right when it comes to marking your zones. But it is only valid if the footprint chart confirms. Another thing is where if I entered here, let's say I took a buy here, where do I think that I should um book my profits? probably at the next high volume node. >> Next high volume node. So what I would do in this case is since I entered over here I couldn't visibly see this. I would mark this and keep and I know that price can do something there unless it breaks it and goes above course but I would book it here. I will not wait because the price can of course react from here. And if you remember from the last session as well we also spoke about the PNB shape. Same thing which we can see on footprint charts. You can also see on the candlestick charts. So you have like something like this a P kind of a shape and it broke down >> and you can see that the price came here touched the P shape and rejected from there. I see >> a little bit even though it went up because primarily we were going up. >> And when I'm looking at this too, especially this uh zone right here that you're want to take longs from um using the footprint charts to get a tighter stop-loss entry. What type of risk-to-reward are you targeting with your type of trades? >> Great question. Now, you tell me, if you were just looking at these Japanese candlestick charts, where would you enter? What would be your entry signal? But a lot of people wait for the candles to close before they take entry, right? They wait for a hammer or some bullish sign or they wait for this consolidation. They would have entered then. >> So, the riskreward would have been very less. But if I would have taken a trade from the footprint charts, it's a fixed stop-loss every time. You enter above the footprint chart, you place a stop loss below the footprint chart. So you would have entered with something like this. This would have been your trade. >> So you have like high high risk-to-reward trades. >> Um I wouldn't say very high, but uh 1 is to threes on a consistent basis that's good enough. I mean I can obviously in hindsight it's easy for me to be like okay it just went and it gave me a 1 is to 10. But that's just this example that this zone was not respected. But this doesn't happen all the time. >> And with someone that has you're targeting one to threes, sometimes even higher basically higher risk-to-reward trades. Does that affect your win rate or do you find yourself still having a high win rate with targeting high risk reward? >> So sometimes there are um trades where I don't take one is to threes. I take break evens. Um I take one to ones. I take one to twos as well. Mainly I aim to take one to threes. But if I see something opposite, some opposite signal when I'm in a trade, I don't mind taking a smaller profit. So, uh, when I started off, my win rate was pretty less. But eventually, as I learned and as I started managing my risk better, that just went away. I just feel like we're day traders and we can really, we just need that small move. It's easier for us to capture the small move every single day because we cannot capture like 100 pips every day. It's safe for us to book small decent profits consistently. And for someone that has six figures of funding, you get consistent payouts. You're trading futures propers consistently on a daily basis. I know people that trade profits are probably going to want to ask you this. What is your risk appetite during the evaluation? And what's your risk appetite during the funded? >> I do risk a lot when I'm passing the evaluations. I don't mind risking 2% in a trade. But again, I think that came with a lot of experience. And uh I would not suggest that for a beginner. If someone's just starting out, I wouldn't ask them to just take two trades and blow your evaluation. At this stage in my trading career, I'm okay with blowing accounts, with blowing evaluation because I do have the money because I do have two trades. >> Yes. Whatever the entire risk of my evaluation is, I split it into two hoping that I pass it in like two trades. >> Yeah. Cuz it's a waste of time to trade during the evals. But for someone of course that's new, it's best to take it more slower and utilize the amount of amount of draw down for a longer period versus just blowing in two trades. Um, when you're funded, how does that change? >> When I'm funded, I just risk.5% on my trade. >> What is it? If we had a 50k futures account that had 2,000 in max draw down, you would risk essentially how much per trade? >> Somewhere around $300. >> Okay. >> Yeah, I risk about 300 hoping to make 600 in a day. When it comes to profirms, are you someone that likes to take the payout right away or do you want to build a buffer? >> Well, um, at this point I have multiple accounts, so I like to keep some accounts for, um, creating bigger buffers, but I do have some accounts. I treat them like my salary accounts, like I can just take out money from it if I want to. The moment I see that uh, I am eligible to request for a payout. I like to take my payouts from certain accounts. But again, let's be real, that does give you a sense of confidence. That's what we're doing all this for. But I the rest of the accounts, I just let them be. I create a buffer and because I want them to grow. >> Well, yeah, that that makes sense for the prof game. Now, I know people requesting last video to see kind of more entries, how you take your entries on this uh on with your strategy. So, can we see some entry breakdowns? >> Trading can be a lonely game and that's why most traders fail. Wayon Plus fixes that live trading every day, Monday through Friday for London and New York sessions. We have a full structured education library from beginner to advance and exclusive courses from the traders that you watch right here on Way, plus exclusive giveaways, rewards, and a community full of traders on the same journey as you. Everything you need, all in one place, all in one community. Visit the link in the description below to become the next Whon Plus member. Now let's get back to the episode. And by the way, if we are wearing different outfits, we are recording this at a different time. So please be aware of that. Okay, Sio. So let's break down a recent trade. >> So I will break down the trade which I took on 21st of September, this Monday. This is how the 5m minute ES chart was looking like before I was taking a trade. I only trade the New York session. So this is where this particular candle, this is where the New York session was actually starting. I was mainly looking for a buy trade because I knew that the overall momentum was bullish. But right before the market opened, I could also see a change of character here. I could see that the market is slowly trying to come down. So I wasn't sure. The price can also give us a very good pullback and a retracement. But I was still looking to take a buy if the market showed me signs that it's still bullish. So I wanted to the buyers to come into the market and show some strength. And then this is what happened. Market opened here. The price started going up, going up, going up, breaking this high, breaking this high. Now, what do you think about the move over here? Obviously, this was a false move. The main trend is still bullish. I did not enter over here because I know this looks nice that the buyers were showing strength, but this is not the move I captured because when the price was here, I wasn't sure if we are still bullish because of this lower low creation here. So, I wanted the buyers to step in and break above these highs. So I just waited for the price to do its thing and the price went and broke above this. That's when I could see that there is a demand area here. Right? >> You can see impulse move, a small candle here and a big impulse move up. >> So I marked this area. This is a demand area for me. Now this particular candle is a demand area. Price came and tapped in this. And now I know that the price can continue going up. >> But how do I confirm that? If we go to our order flow chart, footprint chart, and actually see what's happening inside of this after my analysis on my candlestick charts, that's the last thing I do before I enter. >> And right there, I got this candle. The price came down to the demand which we drew on the M5 chart and then gave us this green candle which is a bullish candle with the delta minus 541 in red color. That means it's a sign of absorption. I know that the candle is green but 541 sell contracts were inside of this. So that's a perfect sign for me to enter according the to the confluences we already knew. And think about it if you need more confluences. Do you see where this candle reacted from? If you see to the left, the candle it reacted from is a perfectly B-shaped candle like we discussed with a 2K delta with a 2K by contacts inside of this. It's not just a random B shape. And then we got this. While this candle might not be a perfect B shape, it still had enough information for us to actually take the trade. And even when you look at this 924777, 924 contracts of sell >> were trapped in this area. This was perfect for me. Buy above the high, stop loss below the low, and you'll see what happened. The price just kept going up. >> How long did you hold it for? I know that in hindsight when you look at it you feel like oh I made a lot of money but I booked my profit at 1 is to4 1 is to4 is good enough for me I'm done for the day if I >> still still a high risk-to-reward ratio >> it is a very but actually in hindsight when I look back on the trade it would have actually given me a 1 to 10 but again that does not happen every day I like to stick between 1 to 2 to 1 to 4 that's the max after that I start aggressively trailing once 1 to 3 is hit I aggressively trail it so that I can actually make the profit and maximize potential. But at the same time, if it's supposed to reverse from there, then I'm fine with that as well. Anyway, if you look at the M5 chart, there was literally nothing in the left side for the price to potentially reverse. So, you wouldn't really know until where you can hold. So, the best thing would be in cases like this, have a fixed RR. >> All right, that is part two of Somia's strategy breakdown. If you guys do want to learn more from Somia, you can check out her links in the description below. And also, if you do want to see more episodes with her, be sure to drop a comment below on what you want to see and also hit that subscribe button. And Sia, thank you for coming on to the episode. Thank you so much for having