Market Profile Trading Setup

[torero 10]

Your style is swing trade these instruments? Thanks.

[Gordon G. 10]

Hi Torero,

 

I like to call it "intraday swing trading", since I try to catch the (few) moves that give me a very favourable risk/reward ratio.

 

I just play responsive in congestion and initiating in case of breakout.

 

What about your style ?

 

Ciao,

 

Michele

[torero 10]

Same as you, I usually take 2-3 trades max per day, that's pretty much what the market offers in terms of intraday trends. What's the best time to trade: morning, near closing?

[ant 10]

Ant, if I understood well your reply, you put a time limit to the trend (for example, 2 days of balance are to be considered so when considering the volume, but for the VA references you prefer to still look at these singularly - daily - because the "pause days" are not many and it can be considered a retracement). It's an interesting point of view !

"When a market is in a trend and then trades between two high volume nodes, this usually indicates that the trend is transitioning back to balance and a larger balance area might form" --> these are two 3:2:1 of opposite directions that would form a bigger time frame 3:1:3. Always found very fascinating this theory. To me Steidlmayer is a genius !

 

Michele, you got it! One comment though. I tend to compare the size of the balance areas (or nodes) that form in a trend, and as long as they're small compared to the balance area from where the market broke out of, I consider that to be nothing more than a retracement and the trend is still intact. For me, this is the hardest part of trading - determining when the trend is over and the market is transitioning back to balance.

[Gordon G. 10]

Thank you Ant, you just gave us a very good tip !

 

It's the same for me ... it's the most difficult part of trading to decide when to switch from initiating mode to responsive mode ... considering that depending on this, different key reference points have to be taken into consideration.

In fact, I was in error on ES considering the 23th and the 24th as a single unit, and took no trade on the opening when it tested the 24th VA.

 

How James said, it's a very subjective matter.

 

Best regards,

 

Michele

[Gordon G. 10]

Hi Torero,

 

I just find useful for EU futures to look at the first 2-3 half-hours in relation to the previous day VA.

Having observed the market here, you can trade responsively or not, depending upon the market conditions.

 

Yours sincerely,

 

Michele

[redlew 10]

Here is an article written by Michael Jardine (enthios) for Ensign's newsletter, describing how he uses POC & Virgin POC.

 

Great link DeefMan, I read it and decided to have a look at the bond market to see if it would hold up there. The chart is a daily volume histogram based on 15 minute bars. Neoticker (software that produced the chart) uses a yellow bar at the mean of the standard deviation as their POC. My highlights use the max volume bar instead which we all know would be the actual volume based POC. There does seem to be a good correlation for the virgins and S/R points. Since the 1rst of October the correlation hasn't been there though. The market has been surging back and forth in a 3 point range since the middle of September so maybe this indicator breaks down somewhat in range bound and more volatile periods. Not bad though for the first look at this!

[MrDeflation 10]

anyone use Enthios Universal system applied to Market Profile???

 

 

thanks

[ant 10]

I posted a "Virgin" VPOC indicator here http://www.traderslaboratory.com/forums/f46/enthios-virgin-poc-indicator-tradestation-810.html#post2814 for those interested in coding the strategy in TradeStation. Would be interesting to see how well it performs when traded mechanically.