How to view real market depth on Forex online

17.09.2021

The stock exchange has an information display tool. It is used to analyze trading volumes. Monitor the balance of supply and demand. Let's figure out whether it is possible to look at the real depth of market prices on Forex.

  1. The concept of depth of market in Forex
  2. Trading strategies based on the order book
  3. How to view Depth of Market on Forex with volumes online
  4. How to use market depth in MT4/MT5
  5. Useful tips

How does a glass work?

In addition to the term “glass”, this tool can be called Level II , Open Book , market depth . Available by default in most terminals for working on the stock market. There is Level II on cryptocurrency exchanges in online platforms, the principle of operation does not change.

As for how to view the order book, in Kwik all you need to do is double-click on the corresponding instrument in the “ Current Trading ” window. To edit settings, use the combination Ctrl+E .

The order book looks like a small table that shows prices and volumes for buy/sell offers:

  • Ask prices are indicated in red , at which other trading participants are ready to sell you an asset. Opposite each level the volume in lots is indicated.
  • Green color (bottom left) – buyer prices. If you need to sell securities, then the asset will be purchased at this price.

The totality of all prices is called offers . The most profitable quotes, in the example for the figure above, 183.20 and 183.22 are called the best Bid/Ask. Gazprom's securities are highly liquid (the company is included in the list of blue chips on the Russian market), so the spread is small. For those who are just starting to explore the world of speculation, the article “What is a spread in trading” will be useful.

Description of how DOM MT4 works

DOM ( depth of market indicator transmits the order book of the currency section of the CME exchange to Metatrader. They are presented in the form of a histogram with bars scaled by the volume of total pending orders:

  • Below the Bid line are Buy Limit orders from potential Buyers;
  • Above the Ask line (red) are orders from potential Sellers.

The word “potential” becomes clear within a few seconds after the first launch of DOM MT4. Volumes in the order book change at a very aggressive speed - trading robots of market makers work on millisecond algorithms.

The Bid and Ask lines are a trading spread that can be negotiated with the terminal or selected from incoming CME data. In this case, the trader may receive an additional signal that limits trading. As a rule, a widening spread indicates strong movements, for example, before news or due to inside information received in advance by market makers.

The CME exchange trades currency futures of different calendar periods. The indicator by default selects the contract with the highest Open Interest. This leads to problems in transmitting quotes when switching to futures for a new calendar period. Many traders do not wait until expiration, transferring (rolling) positions to a new contract, which can lead to large fluctuations in the OI in both derivatives.

Once again I would like to draw your attention to the fact that the DOM MT4 indicator does not provide trading signals. It is suitable for a trader practicing scalping strategies. The tool is best used on the M1 timeframe as an indicator of “high-precision” entry based on signals from a trading system operating on higher time periods.

Broadcasting the price stream of the CME exchange can lead to load and freezing of the terminal; to avoid technical problems, the trader will have to limit himself to 1-2 currency pairs.

Depth settings

For highly liquid assets, purchase/sale orders are placed in small increments. There are no gaps in the glass, like Gazprom, Sberbank and other blue chips. That is, there are no price levels at which there would be no people willing to sell or buy shares.

On low-liquidity instruments there may be levels at which there are no orders. Because of this, prices in the order book have gaps. But for convenience, quotes for which there are no offers are not displayed.

In the settings (opened with the combination Ctrl+E ), you can then display those levels at which traders are not interested. It is impossible to stop the price on them.

You can also change the appearance of the glass in the settings window. For example, make sure that the prices of sellers and buyers are displayed without a vertical shift relative to each other.

When sparse mode is activated, the low density of orders in the order book becomes visible. The display of additional information is also activated through the settings.

The listed settings are optional. Most traders work with a standard order book; it contains enough information for trading.

For clarity, this information can be displayed directly on the chart in the form of vertical histogram (in Quik you need to execute the commands Actions - Draw - Market Depth ). This is the same data as in the order book, but they are shown as lines on the chart itself and act as support/resistance levels.

In the example with Akron shares, it is clear that the bulls defended the level of 6094 rubles . With the usual number of applications up to 40-50 at around 6094 rubles . buyers placed orders to purchase 427 lots. With this information, it was possible to conclude transactions to buy from support. This is the simplest method of using the glass in trading, we will talk about this in more detail below.

Installation and configuration of the indicator

Links to the current version of DOM MT4, as well as a description of the installation process and operation of the indicator can be found on our forum (link at the end of the article). The files were last updated in February of this year.

Please note: there is a separate program that reduces the load and speeds up the operation of the indicator. It is better to download it first, before starting the installation, the process of which is described in the readme file in the archive.

Roman Chadaev, registered on our forum under the nickname chadaevr, placed the scripts in the MQL directory. It must be copied to a folder with the same name in Metatrader 4, which can be found through the “Open data directory” option in the drop-down list of the “File” menu.

When copying, the system will offer to replace the files, to which you must agree. The installation process ends with the transfer of the preset file domtg.tpl. This is a template for setting up the indicator workspace, which must be installed immediately after copying the files and restarting Metatrader 4.

Before launching DOM MT4, you will need to configure the terminal: through the “Tools” menu, open the “Settings” option. In the window that appears, on the “Expert Advisors” tab, enter the URL “https://api.tg.limited” and allow DLL import.

After installing the presets on the window of the selected pair, drag the MT4 DOM from the “Navigator” field or the “Custom” option in the “Indicators” section, Insert menu.

The first time you attach DOM MT4 to the chart, the indicator settings window will open. Pay attention to the depth of the order book - by default, 10 price levels of orders are built on each side of the Bid/Ask. This is enough for scalper trading.

The historical mode of past order book values, required for virtual trading, is disabled by default. The remaining settings are of a service nature: you can set custom colors, contract date, alerts, and temporary terminal settings. By default, they are configured to work with the MT4 DOM when first launched.

After clicking the "OK" option on the settings tab, the indicator will appear on the chart in about a minute. If the wait lasts longer, remove DOM MT4 from the chart, restart the terminal and install the tool again.

What types of orders go into the order book?

There are different types of orders, not all of them are displayed in the order book:

  • If an order is given to conclude a transaction at a market price , then on a liquid instrument the order, at best, will appear in the general list for a split second. The execution is instantaneous, this information is of no use.
  • Pending orders . They are visible in the general list . They are used to navigate levels that are significant for other traders.
  • Orders with different conditions - are not in the general list . The conditions specified by the trader are stored on the broker’s server, and only when they are met will a market or limit order be automatically created.

Please note - large buyers/sellers know that based on their orders, trading can be built on the order book of other traders. With large volumes, large players hide their intentions through iceberg orders. In this case, only part of the real volume that the trader is going to buy/sell is used in the order book.

It is impossible before an iceberg request is satisfied ; only a small part is visible in the general list. When it is implemented, a certain volume for buying/selling will begin to appear in the order book and list of transactions and be immediately satisfied. If the level can be protected, then the price will not be allowed for it. It will not be possible to manually place orders with such frequency as when implementing a hidden order.

Classification of orders by volume and purpose

Depending on the volume, all orders are conditionally divided into 3 types:

  1. Small – the bulk comes from ordinary traders, their volume is about 20-100 lots .
  2. Medium - up to 1000 .
  3. Large - from several thousand for securities belonging to the second echelon. If you work with blue chips, then we are talking about tens of thousands of lots.

The classification is conditional and may change depending, for example, on the price of shares. Please also take into account that some large orders are invisible , since they are issued in the iceberg order .

Purposes of placing orders

Online you can watch how the composition of the glass is constantly changing. But orders placed in it are not always used only for the purchase of securities. Traders have different goals:

  • Buying or selling securities - the trader just needs to open a position.
  • To stimulate stock movement. These are limit orders, but they do not remain at the same level, but constantly move following the price. At the slightest attempt to reverse, the order may be partially satisfied and prevent a corrective movement from beginning. There is also a psychological effect – there is a confident movement in one direction, and more and more traders are joining it. Work in this style is carried out both manually and with the help of robots. Ordinary trader with small volumes not able to influence the market according to this scheme.

  • To protect a significant level , so-called passive orders. As for how this tool works, its purpose is literally to protect levels that are significant for bulls or bears. These orders may not be visible in the order book due to the fact that they are located at a significant distance from the current price. But when the chart approaches a significant horizontal level, you can see how orders with abnormal volumes appear in the general list. This is evidence that the bears/bulls are about to stop the movement at the support or resistance area, respectively.

The fact that a trader has sent an order does not mean that he will definitely execute it. This can be a trap for the crowd of ordinary speculators. It is more profitable for a large player to use an iceberg order to hide his intentions from other trading participants. If a trader places a large volume regular order, that's something to think about: he might want you to think he's about to enter the market at that level. Trading is primarily about psychology , and the glass is an excellent tool for manipulating other people’s opinions .

How to view Depth of Market on Forex with volumes online

It is important to understand that no website or tool shows the complete picture of the Forex market. Therefore, classical trading strategies cannot be applied here.

The data can be used to gauge participant interest. Notice a cluster of orders that form support or resistance. Confirm trading hypotheses.

Depth of market prices for Forex online with volumes are offered by foreign brokers - Oanda and Saxo bank. This information is publicly available on their websites. Each company shows transactions only for its clients. The information is used as a data slice.

Saxo bank website

Let's say that the Oanda broker has information about 1% of Forex trades. Based on this, the assumption is made that the sample reflects the mood of market participants.

The price tends to equilibrium. She moves in the direction where more interest is directed. After conducting technical analysis, the trader can receive confirmation of the data using trading volumes on brokers' websites.

Methods for using a glass at work

Information on orders from other traders can help in trading. You will have to monitor the actions of large players; ordinary speculators with volumes of a couple of lots are ignored. Below is a small instruction explaining how to use the stock order book.

Determining the price at which the order will be executed

This is relevant for low-liquidity instruments for which supply and demand are limited. If you enter with a large volume, then the real execution price differs from the best Bid/Ask displayed in the trading terminal.

In the example with ordinary Avangard shares, when selling 80 lots, there is not enough demand at one price level. Based on current orders, you can determine the real price of order execution. In the terminal at the time the transaction is concluded, the exchange rate of 935 rubles will be visible, but due to the large volume, demand is satisfied at several levels.

In reality, the execution price will not be equal to 935 rubles, but (5 x 935 + 46 x 930 + 12 x 925 + 8 x 920 + 5 x 915 + 1 x 910 + 2 x 905 + 1 x 890)/80 = 926, 25 rub.


For blue chips, only large players may encounter such a problem. Volumes typical for ordinary speculators are satisfied almost instantly without deterioration in price.

Large offer

It all depends on where this offer appeared:

The basic principles of working with “big money” offers come down to using it as a guide when taking profits or setting a stop. If you see such an order in the order book, do not rush to immediately enter into a deal in the same direction. This may turn out to be a common provocation .

Profitable trading in AMarkets

Features of trading using the DOM MT4 indicator

The DOM MT4 indicator does not provide trading signals. The strength of order levels, the change in sentiment determined by the number of Buy/Sell Limit orders are very relative concepts, different for each pair and session time. Threshold numbers are determined through long-term observations of the Forex market, so scalpers often specialize in only one instrument.

Trading by order book is designed for a profit of 2-3 pp and a large number of transactions. This will require opening a special account with a floating or minimum spread. The trader is obliged to limit the holding of the transaction in time and must use a take profit equal to at least two average values ​​of the current spread.

The indicator does not work at the time of news releases or unexpected events that cause simultaneous strong movements on all pairs. Be sure to study the economic calendar before trading or read the analytical section of our daily reviews.

To increase the strategy's win rate, close the position with a minimum profit as soon as the level with a high number of orders disappears. If the order is at a loss, then move the take profit to the entry price to break even.

Try to trade with the trend tracked by M15, subject to trading on M1 candles. Actively use one-click trading, having previously configured the terminal in such a way as to spend minimal time on closing and opening transactions. This sub-EA can help you if you are trading via MT4.

The deal feed as an important addition to the order book

Above we have already understood the principle of operation of the glass. Its main drawback is the inability to understand when and what transactions were actually concluded. A trader can manually or with the help of advisors place any offers and then remove them, misleading others. To get a real picture of what is happening, you will have to work with a table of impersonal transactions (that’s what the tool is called in Quik).

If Level II shows at what prices the offers are placed by traders, then Level I (the table of transactions) allows you to understand which of the orders were implemented . It is advisable to evaluate both tools together.

The table got its name due to the fact that it indicates completed transactions, but all of them remain anonymous. impersonal appears in the title .

Looking at the table of deals, you can see how big offers are “eaten up”. This tool also allows you to identify the presence of iceberg orders . If there are no large offers at Level II, and in the table of impersonal transactions you see a series of simultaneous trades at the same price, then most likely the hidden order has begun to be absorbed.

Tricks from big traders

A classic deception is creating the illusion of the chart moving in one direction in order to force ordinary traders to enter the market. It happens something like this:

  1. A large Ask is issued (not an iceberg, but a regular offer). It seems that there is strong resistance to further growth. Some traders will not buy and will begin to look for opportunities to sell.
  2. Simultaneously with the Ask, a major player gains volume with a Bid , hiding it from others using an iceberg order. As an option, transactions are made according to the market, but the volume is divided into parts so as not to attract unnecessary attention.
  3. When the required number of lots has been purchased, the Ask is removed , and instead a large offer to buy is placed. The crowd believes that a downward movement is now excluded, and purchase transactions are made. Some traders who previously opened short positions get rid of them, also entering into buy transactions.
  4. Due to this scheme, a major player gains volume at a favorable price and leaves ordinary traders no choice. They are forced to move the price to where the big man originally planned.

As for how to understand the order book on the stock exchange, you can’t do without a transaction tape. In the example discussed above, an experienced trader could have suspected something was wrong when analyzing the positions being opened. Level II without data on real transactions does not allow this.

Other techniques are also used . For example, instead of setting a “slab” in the form of a large offer, traders manually or with the help of robots buy/sell at a certain level, protecting it. Level II is useless in such a scenario; you will not be able to understand through it exactly where the interest of a large trader is.

Market book in MetaTrader4 and 5

MT4

MT4 has added a glass, but functionally it is inferior to its counterpart from Quik and other terminals. In MetaTrader4, this tool is called from the context menu or by pressing Alt + B. Through it, you can open market transactions, place pending orders and set alerts that are triggered when the chart reaches a certain price level.

When working with currency pairs and CFDs on shares and indices, you will not see real data on those wishing to buy or sell an asset. The standard order book in MT4 is not particularly useful for trading.

Much more significant custom indicators that show the distribution of buy and sell orders among broker clients. They are used as a guide when setting stops, takes, and searching for entry points. When working with such instruments, I recommend limiting yourself to majors and running crosses. If you don’t know what this is, an article about the main currency pairs will be useful.

Start trading with AMarkets

MT5

MetaTrader5 implements full-fledged glass. When working in exchange mode (some brokers provide access to the stock market through MT5), the same information will be displayed here as in Quik and other terminals.

When working on the Forex market, volumes in lots are also displayed, but the table of impersonal transactions is not available Despite the broadcast of information on volumes, it is useless in trading.

Even at night, offers for majors are constantly changing. There is no benefit from the fact that, for example, at a price of 1.33233 on GBPUSD there is a volume of 45 lots for sale. After a second, this proposal is absorbed, and new ones appear.

Interface: Trading commands #

From the Depth of Market, a trader can send market and limit (Buy Limit and Sell Limit) orders.

Pending orders

On the right side of the “Trade” column there are buttons for placing pending orders. The order is placed at the price in the line in which the button is pressed.

  • — when you click this button in the Bid price area, a Buy Limit order will be placed at the selected price, when you click in the Ask price area, a Buy Stop order will be placed;
  • — when you click this button in the Ask price area, a Sell Limit order will be placed at the selected price, when you click in the Bid price area, a Sell Stop order will be placed.

Trading settings

At the top of the order book there are settings for trading operations:

  • sl — Stop Loss level that will be set for placed limit orders. Indicated in points from the current price;
  • vol — volume of created market and limit orders in lots;
  • tp — Take Profit level, which will be set for placed limit orders. Indicated in points from the current price.

Recommendations for using the glass in trading

When using this tool in your work, I recommend:

  • Combine it with transaction data. Without this, you won’t know which offers were implemented.
  • Use other methods of analysis and search for entry points. If a signal was identified, for example, using Fib levels, and later it was confirmed through Levels I and II, its value increases. For beginners, I recommend taking the educational program “How to use Fibonacci levels.”
  • Be critical of the offers of major players. There are traps all the time, learn to avoid them.

In Forex, I recommend not trying to use the standard MetaTrader order book, it is useless. The exception is the exchange mode of operation when using MT5.

Where to start trading

If the stock market seems too complicated, you can start working with CFDs on shares. In terms of trading conditions and the number of available assets, I recommend AMarkets. In the tables I will give the main characteristics and tariffs of the broker.

Company

AMarkets

Rates Standard Fixed ECN
Minimum deposit 100$/100€ or 5000₽ 200$/200€ or 14,000₽
Recommended capital 1000$ 50 000$
Leverage 1 in 1000 1 to 200
Spread, points Floating, from 1.3 Fixed, from 3 Floating, from 0
Commission No 2.5$, 2.5€ or 175₽ for 1 lot one way
Minimum Margin 1$ 5$
Stop Out 20% 40%
Exiting client transactions to the interbank market No Yes
Ability to place pending orders inside the spread No Yes
Requotes Eat Their absence is guaranteed
Open an account
Criterion AMarkets
RegulationThe Financial Commission
Minimum capitalFrom $100, €100, 5000 RUB for standard accounts
Number of assets100+
Recommended capital$1000
Account currencyUSD, EUR, RUB
Maximum leverage1 to 1000, on ECN – 1 to 200
Spread in pointsFloating, from 0 for ECN, fixed from 3
Commission$2.5, €2.5 or ₽175 for 1 lot one way for ECN
Execution speed, ms53,3 – 70,0
Stop Out20-40%
Exiting client transactions to the interbank market+
Number of positionsNo limits
Pending orders inside the spread+
Requotes
Limiting the number of transactionsAbsent
Limit orders inside the spread+
Availability quote
Own indicatorsCayman (market sentiment) and COT (provides information from the Commodity Futures Trading Commission)
PeculiaritiesWelcome bonus up to $10,000. Cashback, there are tournaments and other incentives for traders

If you decide to switch to Amarkets, I recommend taking a closer look at the welcome bonus . This is a real opportunity to get your first deposit with minimal effort. Previously, a separate post was published about a no deposit bonus on Forex. In it, this pleasant moment was examined in more detail.

Open a Forex account in AMarkets

Summary

In stock trading, the glass and deal tape are useful tools. They help to understand the true intentions of other traders, in particular large players who can influence the movement of the chart. For intraday work, the use of Level I and II is recommended for everyone without exception. If trading is carried out on higher timeframes (H4 and higher), you can do without studying the orders of other traders.

The effectiveness of using these tools directly depends on the experience of the trader. It will be difficult at first, but over time you will get used to it. I can’t guarantee that each of you will be able to predict the movements of the big man, but at least you will be able to see the traps and be able to correctly place stops and takes.

In the comments, you can not only leave questions about working with Level I and II, but also share your own experience. Perhaps there are suggestions or comments - I will also be happy to hear them.

This concludes my short overview of working with the stock order book. Don't forget to subscribe to my blog updates in telegram to be among the first to receive notifications about the release of new materials. All the best, success in trading and see you soon!

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