This is one of the setups that professional day traders look for on a daily basis.
Propensity
“Sloped” is a term used by day traders. It refers to relying on an offer or demand. In other words, if the market has been ranging between 5 and 10 and currently quotes 9 bid/offer 10, traders who are short 8 and 9 lean towards the 10. They expect the bid to hold. If it looks like you are going to leave, they will try to buy 10 bills when you leave. Other traders are also looking to buy 10s because they know the shorts are “leaning” on them. This means that 10 is probably a good place to get an advantage. However, this is also a place where the big traders make moves.
A trader can be 8 long and be the bid at 10. When he gets a strong bid at 9, he raises his bid by 10, then turns around and bids 10 (this is called flipping) and this causes other traders to instantly buy at 11 and 12. Virtually no contracts are traded in 10. In this situation, the shorts are in the gutter. They were looking to risk 1 or 2 ticks and now they are forced to cover a 4 or 5 tick loss. Other people who had no opportunity to buy 10 bills will buy 12 and 13 bills. That’s why you have to anticipate. If you think it’s going to go away, just buy the 10s. If you don’t get them, you don’t want to buy 14s. 14 is where the guy who freaked out is going to be selling. If you miss it, you miss it.
By the way, most of the time these points are not support or resistance levels on a chart. There is no technical reason for someone to buy or sell there. You would never know that traders are leaning on price unless you know how to read order flow. And if you don’t know that traders are leaning into a price, you can’t take advantage of that setup.
