Soultrader

Yep And the second wave test came right at the VAH pivot. Gotta be quick to pull the trigger in this market though or else you will end up watching it go up and up. Also wide stops is recommended in my opinion.

Quick video on Fed days. Some of you may already be familiar with playing Fed days from Huberts videos. In my opinion it is a valid way to play it. The first move is usually the correct move but impossible to get in without chasing and getting filled at the highs. What I like to do is if the first move is up, I will time my entry on the long side by waiting for the second correction to finish. Remember try to use limit orders in this kind of market. Market orders will get you filled +-10 pts away from the trading price. CLICK HERE TO VIEW VIDEO Charts created by Tradestation

Great stuff walter. Thank you for your contributions. Much appreciated

Sounds good Tin. Sorry about last time... my comp can not seem to run skype with TS so it will be limited to premarket. How does anywhere from 8:00am EST to 8:30am EST sound? Should give us 30-60minutes just to share some insights and thoughts on the markets.

I figured some ppl might want to talk directly using the mics. Up to anyone who is interested. Let me know. Thanks

I am interested in starting a skype chat room or even skype conversation for those who may be interested in exchanging ideas before the market. This would be more of a market outlook for the trading day, going over key levels, and possibly discussing some trading strategies for the day. I want to keep it rather small and focus on the YM and ER2. So if you are a YM or ER2 trader and would like to brush off ideas please let me know. This could be 30min - 60min a day depending on our schedules.

Here is my input on what I watch for trend vs range days. First the previous day high/low. Price needs to break this range in order for me to determine whether we will trend or not. If price is contained within the previous days range, we have a rangebound day. (not unless we have a wide range of over 200+. This is not the norm) So early at the open, I will check to see where price is trading in relation to the previous day high/low. Second, I watch tape during the opening 30min or so to determine whether the big boys are playing or not. The markets will not trend intraday without big money. Third, I watch for premarket action. If there is enough volume premarket on the SSF's with heavy trading on the index futures, this alerts me that we may seem good movement in price during the trading session. Of course as the day starts, understanding TICK's will help determine the strength of the markets. Volume and price analysis will work too but I find it important to be able to determine a trend vs range early in the session. The times I have most difficulty with trend days is when price creeps up on low volume. Now this gets me everytime. :mad:

This is a handy tool coded by weiwei that offers a timer for each minute price bar. So if you are using a 5min chart, this will count down until the bar closes. The indicator is very flexible with modifications made by weiwei allowing users to adjust the location of the timer accordingly. Thanks to weiwei for this contribution. Screenshots are not attached as this is pretty obvious. Note: Once applying it on your charts, you must wait until the current bar closes in order for the timer to show up. #MINTIMER.ELD

True indeed. If 3 trades are not working.... best move is to shut down your comp. Otherwise you will spend the entire day frustrated, trying to make up your losses. In most cases... it leads to further losses.

Thanks brownsfan. I started using a 1500v chart but still need my handy 5min chart next to it. Also, Paul excellent post. How do you usually check the average volume. Through your charts? Or do you get the data from the cme? Thanks

Welcome aboard btrader. Glad you like the site

Hi walterw, I was also looking at a 5min and 30min chart. Although price was lifting, we were seeing low volume rallies. The big boys or traders that matter to move prices were simply not around. I should of been more clear about it but I am always interested to see whether the big boys are supporting the move up or down. In the afternoon, they are simply not there. Regarding my exit and how I mentioned low volume..... I was reading tape and tape was stuck in a traffic jam. Also, 1500v bars were starting to form extremely slow and told me that there was not too much interest on the supply side. Tape showed lack of supply once it hit below 265.. and it kept hovering between 263-267 for 5mins or so. I decided to book profits at that point due to the lack of volume and interest. Hope this makes sense.

lol okay shooting star it is!! Anyways, all I know is that candle indicates reversal. The confirmation was the bearish englufing in line with Fridays high making this a short setup for me.

haha yea inverted hammers. Im no good with cande names. I guess the afternoon was good for quick scalps but I only took that one morning trade the entire day. I played around with the several different settings on the volume charts and I found bearish/bullish englufing patterns on a 1500v chart at key levels extremely powerful. Spent the entire weekend going over charts... and the 1500v also fits my risk parameter. I guess its traders preference?

Short video from todays trading, March 19, 2007 using candle patterns and previous day high pivot. CLICK HERE TO VIEW VIDEO Charts created by Tradestation

There is good support around the 160 mark.. so I would not go about fading Fridays low. Also.. this gap is pretty interesting right now as we are trading at 12260 as I post this. On the daily, there is serious accumulation indicating strength. I am looking alot on the upside this coming week..... perhaps the professionals gapped it up to eliminate supply? If not the R1 is going to act as key resistance for todays trading.

Interesting daily chart on the YM. The second test occurs on extremely high volume with a close at the high. This indicates professional buying. If there is still supply left, we can see another test on lower volume. If not, price will be likely to advance. Perhaps a swing trade instead of day trades on the YM may be a good idea to profit from this move.

Thank you for the input Tingull. My levels for today are very similar to yours. 12358: VPOC from 3/13 12325 - 12330: R2 pivot, 3/8 low, 3/9 low 12284: two day upper bracket, previous day high and 3/15 high 12230: weekly pivot and 50% fib 12176 - 12170: previous day low, 3/13 low 12161 - 12165: VPOC from 3/14, lows from 3/1, and S1 12126 - 12116: 3/5 low, S2 (how valid is the 3/ low?) What I am interested in seeing today is how candles behave at those levels. Couple things I will be watching for are dojis and bullish/bearish engulfing patterns at these levels. The 12230 - 12225 mark is a ultra key level I will be using as a reference point for the day. The range from 12160 to 12176 is a little tricky today so I will not be playing anything in between. I also will not be playing VAH and VAL as well. (no guarantees though)

I am taking a look back since the beginning of 2007 to better understand psychology behind candles. These charts do not show actual trades taken, but examples of possible trades based on the psychology behind candles. (yes it is hindsight analysis but the point here is to learn the pscy behind candles) I will be following up with various charts from the beginning of the year. Setup Parameters: 20pt stop maximum Strategy: Pivots, Previous Day High/Low, and Candles Chart: 1500v Chart #1: Jan. 4, 2007 Green Line: Resistance 1 Yellow Line: Daily Pivot or PP White Dotted Line: Previous Day Low Step by step candle analysis: Taking a look at the first opening bar. The green bar shows optimism for new established longs as it stretches above resistance 1. The second bar shows a long wick (longer than the real body of the candle) indicating selling. The early longs booked in profits while the late longs (those bought near the end of the first candle) are definitely feeling uncomfortable at this point. The next two bars are red candles closing below the first green buying bar. This is extremely important to understand. The longs from the first bar are now facing a loss. Paper profits have now turned into paper loss. The market chops for a few and then retests the R1 pivot line. The fact that it reaches about half way of the first opening bar (Bar 1) gives the longs false hope. They have seen price advance, price decline below their entry point, and now price coming back to their entry point. Notice the blue arrow that says "Bearish Engulfing". The red bar crushes all hope as sellers come right back in. The longs who are willing to take a loss will start selling as they are seeing downside pressure. Those who are still praying will leave their stops in and wait for the market to take them out. An good entry would be on the next bar after the bearish engulfing pattern. The white dotted line represents the entry point at 12623 with a stop above the high of the previous bar at 12635. (right above r1 also) The second bearish englufing patterns occurs on the next red bar. (yellow arrow) That bar takes all the stops out from the earlier longs (Bar 1). This drives a downward momentum with stops and shorts. Exit signals: I find exit signals with candles a little too late. Therefore I personally find it good to have an exit target before the entry based on significant price levels. The white dotted line shows the previous days low. A very good target level. For shorts who are expecting more, narrow range bar gives off the first warning signal. Notice the rising three methods also. Three red bars followed by a green bar that takes out the real body of the first red bar. This should be an immediate warning signal for shorts as well. Traders who shorted any of the three red bars are now seeing price move against them. You also get the first higher low confirmation. The chart shows a simple setup using candles, pivots, and the psychology behind the candles. More charts to come...

Thank you GCB for your contribution. I will check this out.

Do you see the megaupload filebox when you use the "Go Advanced" button for posting a reply? You can upload the file there and post the link to the file.

Im not sure how it works over in the US, but in Tokyo everything is taken care off. When I changed my line to fiber optics just recently I had the guy from the internet provider company setup the hardware for free. All I needed to do was purchase a router, plug it into the fiber optic box, visit my internet providers website, and it read my router automatically. Took me like 5 mins.

True enough... perhaps I should of cleared it up. I was looking for an optimal volume chart timeframe suitable for my risk tolerance. With candles, this is more of a confirmation > enter type strategy. Therefore any entry requires a slightly wider stop based on the previous bar high, HOD, LOD, etc... With a wider timeframe the confirmation comes later. Hence a wide stop. With a shorter timeframe the stops can be slightly less. My risk tolerance is a maximum of 20 YM pts per trade. Therefore finding the right interval with volume charts is crucial for me to decide whether I will take the trade or pass on it. So basically, I was just testing timeframes that give setups with no more than 20pt risk and that signals valid candle patterns. By valid, I mean with a volume chart I need to see a clear fight between the bull and the bear. With business plan, methodology, money management, etc.... nothing is being changed here with my trading. Im taking my core trading style/methodology and adding a little twist to it by incorporating volume to a greater degree.

Hello guys, I am a newcomer into this thread.... I've been having trouble keeping up with all the posts that come across on this board now. It's growing! But man! How did I miss this thread? Amazing stuff brownsfan... it got me studying volume charts for the past 2 hours What triggered my attention was your statement on how you want to see the fight and not the breather. That is so true it blows my mind that I never though of it. I have a few things that I want to clarify, hopefully you guys can help me out. First, I am experimenting with a 1000 share bar chart. Is this correct? Or do you guys use a 1000 tick count chart? Also, Im still trying to find the ideal count on the YM... so any input on this would be appreciated. Also, I want to go over the absolute basics of volume. In an uptrend, a healthy trend will show more volume on the rally and less on the decline. Now with the volume chart, would this be shown by more candles printing on the rally and less on the decline? Also, when plotting a volume chart is it not possible to plot the volume histogram panel as well? My TS is having issues doing this. Now one of the things I am having trouble seeing is the comparison in volume at a double top or a test. I like to watch for less volume on a test of the highs or lows. With a volume chart how would one observe this? Does one need to gain a feel of the fast/slow process of candle formation? Also, great explanation on the chart Paul. And good point on candles not offering profit targets. My question is what determines your exit point? If the same confirmation method is being used for an exit, wouldnt you leave a good amount of points on the table? This is the hardest part I have with using candles.... the exit point. Due to my nature as a pivot and tape reader, I do look for exits at a pivot. Now majority of the time I end up exiting too early. Exiting early is something I can live with... but exiting too early is a horrible habit. Wide range candles is also an exit bar that I look for... just curious to see how you guys exit based on candles. Thanks

Yes, definitely waiting on this keymoo.