GBPUSD Order Flow - Exhaustion of Selling Flows

Hey traders,

This is an update to a previous long idea.

Remember, keep it down to the very basics...

In the GBPUSD market, we have a trending market off the daily timeframe and I saw the short-term price retracement as a buying opportunity....

Given that the OFA script had fired a DIAMOND pattern.

This makes us build the thesis to look for long positions in lower timeframes.

But how? Here is where the order flow script comes in handy.

The aggregation of flows via the OFA script helps us visualize the dynamic waves forming to get more precise triggers in these lower timeframes.

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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