ES Vol Chart. Seems to be a lot of peak vol. blow of bottoms recently. Looking closely on the 1 min, they are divergent too.
A Blow off Bottom is a larger than normal peak in volume. In most cases, it will be well above the volume trend line. In this case, the slope was at 6K, and the peak was well above 8K- +40% odd... 3 ticks later the volume has dropped to 2K-60% down, but the price has gone lower. If the lower price is "vailid" or going to be a continuation, we would expect to see an increase in volume. If this trend was to continue going down , we would expect to see a volume of 7K ish.
A Blow off Bottom is a larger than normal peak in volume. In most cases, it will be well above the volume trend line. In this case, the slope was at 6K, and the peak was well above 8K- +40% odd... 3 ticks later the volume has dropped to 2K-60% down, but the price has gone lower. If the lower price is "vailid" or going to be a continuation, we would expect to see an increase in volume. If this trend was to continue going down , we would expect to see a volume of 7K ish.
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A zero cross on its own is a bit weak.
I trade cci trend line breaks and I prefer the break to occur around the zero area and preferably with some divergence.
If you look at the first major low at 7650 you'll see a cci trendline break (you have to imagine the line) and regular divergence all helping to give a high probability long trade. The cross over the zero happened a bit later to give confirmation.
Another method is zero line rejection and you'll see that the subsequent pulllback caused the cci to pullback also to the zero line and then reject it. So providing an opportunity to add to or get long again.
I trade cci trend line breaks and I prefer the break to occur around the zero area and preferably with some divergence.
If you look at the first major low at 7650 you'll see a cci trendline break (you have to imagine the line) and regular divergence all helping to give a high probability long trade. The cross over the zero happened a bit later to give confirmation.
Another method is zero line rejection and you'll see that the subsequent pulllback caused the cci to pullback also to the zero line and then reject it. So providing an opportunity to add to or get long again.
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neil
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NICKW
Hi Nick,
If you or anyone else is interested here is a link to an in depth discussion of the CCI as a trading tool:
http://www.talkstox.com/forum/showthread.php?postid=16237#post16237
Hi Nick,
If you or anyone else is interested here is a link to an in depth discussion of the CCI as a trading tool:
http://www.talkstox.com/forum/showthread.php?postid=16237#post16237
Just a reminder about the 100MA , using it as support/resistance and confiirmation of direction change. You will normally get two opportunities to exit a trade at or near a top, sometimes three. You will also get at least two opportunities to enter a short from a pullback to the 100MA as confirmation of direction change.
