Day Trading and Your Life.

malaspina said:
Low volume in NQ,
Click to expand...

what ?? on the 29th of December ?
no kidding ? you are a genius !!

or you would be if you did what every other professional trader does and take this week off, and spend it on a tropical island (I'm on Koh Samet btw, lovely)

it just annoys me that a moron such as you comes on here and can actually fool newbies into thinking that you know what you're talking about...for awhile until they wise up and catch themselves on .....
 
I am still waiting for average volume to come alive in the NQ tape. I do not trade the market if I do not see the volume in the game, this is the gas that moves the market as I have said before. I will keep you posted as soon as I get into the action.
 
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It looks like today the NQ volume came back to normal levels as you can see it in the chart below, this is a very important detail you have to take in account, volume, volume, volume, if there is not volume there is not fun. You need volume to move the market. Tomorrow I will resume my trading and will begin my year 2011. I hope you the best in this new year of trading business.

volumenq_jan32011.png
 
Today I want to share with you the importance of levels of support and resistance using them with price and volume, remember, these are our only two indicators, we need to use them wisely. Take a look at the chart below, you will see how the price set it´s first levels of support and resistance during the first minutes of trading, patience to sit and do nothing during this time is important. Then you need to wait to see how price and volume behave around those levels in order to take your trade with the flow. As the trade continues, you need to pay close attention to the new levels of support and resistance that will be created and how those levels are penetrated based on price and volume, pay close attention to the size of the actions and reactions and their volume, who wins, leads the trend.
 
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Volume confirms price action.

Volume confirms price action.

It takes time to learn how to read price and volume, this won´t happen overnight. With this post I want to help you to understand from my point of view the reality behind these two indicators. This is a simple fact that I use during my trades: “Volume confirms price action”, this has helped me to lose less and to enter the right side of market as many times as I can, this is easier said than done since it is very difficult to read the market in real-time and that is the reason why I say that your trading system must be very simple, there is no time to think too much in day trading.

I want to take you step by step to explain my point, in my next post I will elaborate more, please read on…

Volume confirms price action: One example, when you see a big body candle backed up with over the average volume, this is a confirmation that the move is valid. In the other hand, when you see a big body candle backed up with low volume, this is a sign that the move might not be as strong as it looks, so beware.

Remember, this is just a simple case, you have to learn how to read the whole price structure to enter your trades with the stronger force in the market at any given time.
 
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During all these past days I have been busy day trading the NQ. After the trading day I try to do some exercise, I usually run every other day to keep my mind fresh and out of the market for a while, this helps me a lot to keep me focus. Sometimes when I am running some new trading ideas come to my mind that help me improve. I have been thinking to open a free chat using Skype so anyone can follow my trades real time. This is free, I won´t charge anyone for it. I just want to provide some help to new traders out there. I will just enter my entries and exits areas, in this way you can have a feeling of what I do. If anyone is interested please send me an email with skype contact information and I will add you to my skype chat group.

This is all for now. I hope you are doing very well.
 
Volume and price are my only two indicators, so I pay close attention and watch them closely during the day. Volume integrated with price give you clues about what could happen next. Areas of support and resistance are valid as long as they are backed up with high volume. If you pay close attention to the next chart you will see how volume and price act together, it is your mission to read the message.

2011-01-26-tos_charts.png
 
If you have the passion to take on this journey you then have to learn how to read price structure. Once you get to understand how to trade off price structure a new window of opportunity will open up to you. In fact, you will trade less and will put your money on the line once the odds are in your favor, as a result you will lose less and win much more than you lose. As I have said before, what point does it make to win $500 in a ten minutes trade to lose it later during the day?, it is crazy, if this is your case you are losing money and your time.

If you take a look at the next chart, you will see my notes, please study how volume and price send you clues about where the price should go next after the fact of the 5 minutes candles.
 
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malaspina said:
Please, I BEG YOU, do not be fooled by those GURUS who talk about using magical technical indicators, I have seen novice traders using like 10 indicators at the same time, IT IS CRAZY!!. Please follow my advice, do not do that.
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One should never make blanket statements.

I personally don't use indicators or advise anyone else too but I would never say it is crazy.

I came back from a seminar this weekend with somene that uses multiple indicators, has been making money for over five years straight and is on his 93rd winning trade in a row (and had the statements to prove it).

What works for you, works.

That is the only truth out there.
 
malaspina

I've bookmarked your chat room, I'll see you in there! Always useful to bounce ideas off of someone else.

jog on
duc
 
Hello dear members,

I just want to let you know that my wife will be having our first baby girl very soon so things are getting complicated. I will be on and off from day trading for the next days, also I have not been able to open my free chat room as I said I would, sorry for that. I will try to post more information here as I have the time.

I hope you are doing very well.

Yours,

Humberto.
 
Blow off short move…

When you see a very fast advance in price with an explosion in over the average volume, in fact you can see a spike on it, there is a huge probability that you are in the presence of a blow off move. I always see this pattern over and over again and always turn out to be the end of the move in a long or a short play. Please take a look a the next chart, you will see what I am talking about.

1tos_charts.png
 
Today I read this and I found it so truthful that I wanted to share it with you.

“Markets are living entities in constant change–and the key to trading survival is to learn to recognize change and adapt. If you use rigid, systematic trading rules, blindly applied to all market conditions, you will not survive as trader. By: Reza Dilmaghani“
 
Today I want to explain why you must understand this formula; trading profits = (price+volume)*art

Price is defined by supply and demand (volume), and how to discover what the strongest trend is ruling the market at a given time, you need the “art” component of the formula. Yes, “art”, a trained eye that will detect the clues sent by the interaction of price and volume, each price candle has a meaning, but just one candle is not enough to understand the message of the market, you will need to learn how to join together all the candles meanings for a specific time range during the trading day to understand what the market is telling you. You need to see on the chart what the price has been doing and where the price is going to jump on board in order to enjoy the ride of the strongest trend.

Please look at the chart below:

Point (A), on the chart is confirming the strongest trend in place. This action is telling me that I am ready for a long play. I would have taken my long position in this area (A). Look how high volume and trending candles are signaling the beginning of a bull move. The bulls where strong enough to advance through the previous pull back and to break the first resistance area of the day on high volume. I won’t disclosure my entry. It is your job to place your best bet here

Point (B), most of the time there is a pullback, this one was on low volume and also on doji candles telling me that there is some profit taking but there are also buyers holding the reaction, I hold strong my position in this area and I stay on the play as long as my stop loss is not triggered.

Pont (C), my idea of a bull move is confirmed with trending candles to the upside backed up by high volume, in fact, this is a blow off move, marking the end of the uptrend, at least for this period of time. Look how we have this set of bull trending candles on capitulation volume, you can see a spike on volume, usually trending candles with very high over the average volume 90% of the time are signaling the end of the move, so be ready to take profits.

As you can see the formula is right: trading profits = (price+volume)*art

Please remember this formula, it will give you more profits than any trading indicator on the market available today.

2011-02-11-tos_charts.png
 
am i the only one not seeing the charts? I just get a red cross where the chart should be.
 
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