The algorithm knew stop losses were placed above the high. It pushed price up to trigger those stops (using very little capital), then sold the momentum to the trapped breakout traders.
Unlocking "Daemon Goldsmith - Order Flow Trading for Fun and Profit.pdf": The Core Concepts and Legacy
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occurs when one side of the market aggressively absorbs all orders from the opposite side without moving price significantly. In Jigsaw Trading terminology, this setup involves identifying large bids that hold price. But as an advanced concept, absorption isn't just about one rule; it requires confirmation through multiple clues: orders increasing as price approaches, the bid holding during market pressure, and orders maintaining through news events.
If you've ever felt like the market is your enemy—taking your stop-losses with surgical precision while you watch helplessly—you're not alone. Many retail traders spend years learning (lagging indicators, wavy trendlines, and "guaranteed" patterns) only to consistently lose money. The book " Order Flow Trading for Fun and Profit " by Daemon Goldsmith offered a radically different perspective nearly a decade ago. The algorithm knew stop losses were placed above the high
Daemon Goldsmith. Goldsmith Holding Corporation, Business & Economics - 205 pages. Google Books Order Flow Trading For Fun And Profit
"Order Flow Trading for Fun and Profit" by Daemon Goldsmith focuses on utilizing real-time market data, such as the Depth of Market (DOM) and Time and Sales, to identify imbalances between buyers and sellers, moving away from lagging indicators. The methodology emphasizes observing liquidity pools, absorption, and passive versus aggressive trader behavior to find market edges rather than relying on predictive charts. This link or copies made by others cannot be deleted
[daemon] name = "goldsmith-ethusdt" mode = "paper" # paper | live
The goal is not to build a HFT monster, but a reliable order‑flow bot that can run on a modest VPS.
At the heart of Goldsmith's methodology is a simple but profound premise: traditional technical analysis focuses on the effect (the closed candle), whereas order flow analysis reveals the cause . The market is driven by the constant cycle of .