Learn to read between the lines - page 2
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Volume
THANKS SIMBA
VERY INTRESTING...thanks simba
look at the pdf ..also intresting but probobly not possible in metatrader
regards
lodol
THANKS SIMBA
VERY INTRESTING...thanks simba
look at the pdf ..also intresting but probobly not possible in metatrader
regards
lodolWelcome lodol,
Yes the pdf is very interesting,and probably very difficult to code for mt4.
So we will have to stick with just learning to read the market...as usual
I will continue with GBPUSD tomorrow after european opening.
Welcome,
Tick volume is what you see at mt4.
I would use volume as suggested by Tim Ord
1-Measure the average volume per bar for the upswings and downswings.
2-SETUP:you need a volume difference of 50% minimum between Swing and ,This is very important,either previous contrary swing or previous same direction swing...Example,GBPUSD chart,I have calculated and texted the average volume per bar(AVB) during the last swings...first we have upswing with 1014,then downswing with 1445..so,looks like the volumes were pushing down prices,Then,next upswing is the key...it has an AVB of 1611...Is this at least 50% higher than previous downswing 1445?No..Is it >=50% higher than previous upswing at 1014?..Yes...so,we have a setup,here you have the first cue that the energy might be swithching to the upside...
3-Entry:I have measured the AVB of the last downleg,until the last closed bar,it is 1226,lower than both previous upswing and previous downswing,so what we want to see for a LONG entry is first a downward penetration of the previous low,then a turn up with upside penetration of it...at this moment we can measure the final AVB for the downswing and see if it complies with the condition of having a 50% difference with either 1611 or 1445..(logically 1611 is the level to monitor)..so if the final downswing before the upwards penetration is <=1074...the setup is confirmed...1611/1074=1.5...and we have an entry.
There are other ways to enter too,like checking relative volumes at support bars and penetration bars,and using trendlines...I will explain them in later posts,so,for the moment lets follow the set up on GBPUSD and see what happens.
NOTE:If somebody can create or modify a zigzag indicator so that it can print the AVB for each swing,
it will be much easier to spot potential set ups in the making.Is the volume that is plotted in my IBFX MT4 platform the volume I use?
I have been told that it is not an accurate figure...is that correct?
When you do your AVB calculations, do you add the total volume of a swing and divide by the number of bars in the swing?
Thanks again for sharing this
Simba,
Your volume color bars are not conductive to what you want to do. It would be much better if you colored the volume bars based on the price bar closing up or down. It will show what the volume is actually doing per price action. I hate the generic volume indicator from MT4, which you are currently using because it does not take price into consideration...which I feel is wrong.
Simba, Your volume color bars are not conductive to what you want to do. It would be much better if you colored the volume bars based on the price bar closing up or down. It will show what the volume is actually doing per price action. I hate the generic volume indicator from MT4, which you are currently using because it does not take price into consideration...which I feel is wrong.
Nothing at mt4 is conductive at what I want to do in this thread,per se,since what I would need is a zigzag that texted the average volume per bar during each zig zag swing...And one of the goals of this thread is to see if any of our programmers is interested enough by the method that considers it worthy to create/modify a zigzag indicator to comply with the requirements.
I don`t use the colours of the volumes at all,they are standard settings,and if I changed them I wouldn`t use the new colours too...
What I do is count the bars during each PRICE zigzag leg(example 10) and then by applying an sma(example 10) with the same length TO VOLUME and pointing the cursor at the last point of the swing,get the average volume per bar of that swing...
Then if there is a new swing with,let`s say,8 bars,I modify the sma to 8 and redo the process,It is boring as hell,and,more important,not having the volume zigzag prevents/slows us from quickly scanning several pairs at different timeframes and detect imbalances from which to profit.
When I apply some VSA technique to fine tune the analysis,the colours of both price bars and volume bars are ok as they are..for example a no demand bar (small spread,close in the middle,low volume) is very easy to see that way,same as "test for supply","test for demand","stopping volumes",etc...But if I coloured them as per your specs,they will probably be equally easy to spot,so,it is a matter of personal preferences.
Is the volume that is plotted in my IBFX MT4 platform the volume I use?
I have been told that it is not an accurate figure...is that correct?
When you do your AVB calculations, do you add the total volume of a swing and divide by the number of bars in the swing?
Thanks again for sharing thisRick,
Yes,you can use IBFX volume,yes it is not accurate figure,but I have been comparing volumes for WHC trader and Dukascopy(one of my brokers),and even if the difference in absolute volume is enormous the ratio bar to bar,swing to swing of the whc platform is useful enough to be used as a guideline...so,I presume same would happen with IBFX...Denbur explains it in detail in his thread at FF,referenced in my first post,so ,if you need a more detailed explanation you can check his thread,I will give a basic explanation here and won`t repeat..Smart money need more tick volume to either accumulate or distribute their holdings from/to small traders,so,these processes are reflected at small trader`s platforms provided their customer`s base is wide enough ...Obviously,if we wanted perfection we could use esignal,which ,as per their information,integrate 300 banks and institutions and aggregate their volume...IMO not necessary.
Now
Now we will need a breakdown of the previous low with AVB qualification (a difference of 50% average volume per bar with either the previous upswing or previous downswing,obviously previous downsswing is the higher of the 2,AVB=1621,so we will need an AVB that is around/ below 1080..1621/1080>= 1.5...)...Then price should CLOSE back above previous lows to get a buying signal.
Check bars numbered 1 and 2 they show supply coming into the market,bar 1 comes just after a weak volume upswing,and bar 2 shows an increase of aggressiveness by shorts,since volume is even higher and supply comes at lower prices than the ones we got at 1... I have drawn the supply line to facilitate the next analysis.
Downmove will continue?
2 important things...first: prices have broken down previous lows and closed above them..second: the(temporary) AVB of the swing doesn`t qualify for a long signal..yet.
Additionally,there has been what Tim Ord calls a High volume retest,according to him,if prices break down a previous low with a BAR volume that is 97% or higher than bar volume at previous low...the down move will continue...you can see that the volume was higher at the breakdown bar than at previous low....Let`s see what happens,it is starting to get very interesting
Simba, nice to have you back. Gave the thread a little 5 star bump. As always, quality content.
Thanks for taking the time... it's appreciated,
MM
Simba, nice to have you back. Gave the thread a little 5 star bump. As always, quality content.
Thanks for taking the time... it's appreciated,
MMThanks for your kind comments,apparently another reader gave it 1 star,since it was at 3 stars with 2 votes ..my usual friends at the Forum
..
I don`t care about stars in general,since most of the threads with 4 or 5 stars got them by 3 or 4 votes,same as those with 1 or 2 stars,so,it looks to me like the end result is generated mostly by friends of the thread originator or by the usual vindictive frustrated with account to settle,so,unless the thread has 15 or more votes I don`t think stars are relevant.
In any case,I appreciate your vote and I appreciate your comments even more,as I would appreciate the comments of the reader that gave it 1 star.