EA for manipulated markets

[resin17]

Hello, there.

I am thinking of writing an EA that can profit from manipulation actions in the markets. The idea is to identify manipulation early and follow its direction (usually down) and then follow a reverse trend (or bounce).

I am thinking of using volume and momentum indicators in combination with a price change in a given timeframe (bar).

http://forex-indicators.net/volume-indicators

http://www.incrediblecharts.com/indicators/momentum_indicators.php

From what I know, however, the volumes indicator only counts ticks (or price changes) without differentiating between the Sell and Buy orders and I, preferably need to count the Sell orders. It'd be handy to use an already made indicator that counts the Sell volumes. Do you know of one?

Has anybody thought of this and can share with his/her ideas?

Thanks

R

[Simon Gniadkowski]

The only volume you can see is that of your Broker . . what about all the other Brokers and Banks ?

[resin17]

Yep, you are right. This is a limitation with using volumes, hence I will need to use a well established broker that have a lot of transactions, like Alpari...and will have to stay out of hours known for very low volumes...not ideal, but hope it can still work...

[qjol]

volume on metatrader has nothing to do with buyers or sellers
it's only counting ticks

[JC]

resin17:

manipulation actions in the markets. [...] Has anybody thought of this and can share with his/her ideas?

In addition to the very valid points made above about what volume means in MT4, and what it means in an OTC market more generally, I'm always wary about talk of "manipulation".

Arguably, the forex market is uniquely prone to "manipulation" in the form of central bank intervention. But, instead, most of the articles I've seen about "manipulation" are basically re-hashes of trading tales from the relatively illiquid and inefficient equity markets of the 1930s, with no obvious relevance to today. I'd beware of anything which talks about "cornering the market", "driving the price up/down", or anything with an implicit or explicit long-only bias (e.g. most of the articles about volume spread analysis which I've had the misfortune to have to read).

[resin17]

Thank you for reemphasing the point I made earlier about the volumes expressed in plain ticks and inability to differentiate between ticks created by SELL or BUY trades.

As far as manipulation is concerned I have no doubt of it taking place and more noticeably in commodities and stock markets and this is where I think the main application of the EA I am thinking of is. A lot of MT4 brokers offer access to all sorts of commodities and stocks nowdays and I have traded them by hand...