Here's a recording of our 15th January Webinar - Day Trading Without Charts.
In this video we look at how to use the intraday volume profile to determing trade entry and exit points as well as WHY it works.
As usual change to Full HD, Full Screen for best results.
From a chart perspective, we consider the extremes of the swings to be support & resistance. Some traders will look at the open/close of candlesticks and ignore the tails and others simply look at the highs & lows. For pullbacks people might use Fibonacci levels or an indicator like a moving average or an oscillator like MACD.
What we do in this webinar is consider market analysis using the intraday volume profile. That is just the volume traded at each price in the current session. The volume profile is just 1 column of numbers OR one histogram that shows us how many contracts have traded at each price.
Let’s consider WHY a single column of numbers often tells us more than a price chart.
When we pull up a volume profile we have a different picture than the chart. We can often see areas where not many contracts traded at certain prices. We can see areas where a lot of trading took place.
We can start to make some educated guesses about:
- whether those traders are still in the market.
- If one side has got out, where the ‘winning side’ will defend their positions
- Where stops are and if they are about to be run over (breakouts)
- Where a pullback is likely to hold if a continuation is on the cards
- Areas where the market will move slowly and where it will move quickly which will impact the amount of time you have to make a decision once in a trade. It’s much better to have the slow moving area on the losing side of your trade
Not only does this give us entries, it also gives us the chance to enter the market with smaller stops because you know exactly where the pain points are. You know that once you get through a pain point one side is going to exit and that will create an extended move.
The idea behind using volume profile is that one of the most important factors in future price movement is NOT where the market has been as much as where traders are positioned right now.
Price charts show the result of trading but volume profile is better at highlighting positions currently held by other traders.
Day Trading without charts isn't some advanced set of techniques for super-traders. In fact, most prop shops start thein interns out this way because it's the fastest way to profitability.
Presentation Slides are here: Trading Without Charts Slides