Volume analysis – The Key to the Truth

[Petar Jacimovic]

Hello everyone,
I opened this thread for Volume price action analysis. I am a full-time trader for more than 7 years and in my analysis, I am using volume and price action. I combine Volume spread analysis, Wyckoff analysis and pure price action to create a smart view and try to follow the smart money.

Feel free to post your opinions and forecast the market >

Happy Trading

 

[Petar Jacimovic]

Hello traders,
I saw major weakness today on EUR/USD at the price of 1.1615. I marked letters on chart >

a - Buying climax (a major sign of weakness today). A wide range of the bar closing on the middle. It must be that sellers stepped in.

b - Another sign of weakness. Bar closed near to bottom in a high volume. This was a very first bar after climax, which is a sign that buyers don't have power for the higher price.

c - No demand bar. The narrow spread of the bar finished in the middle. This is the final confirmation that selling looks safe.

I already secured a position on BE.

Targeting 1.1520 at least.

If you like analysis feel free to comment >

 

[Petar Jacimovic]

Hello traders,
I saw major weakness today on EUR/USD at the price of 1.1615. I marked letters on chart >

a - Buying climax (a major sign of weakness today). A wide range of the bar closing on the middle. It must be that sellers stepped in.

b - Another sign of weakness. Bar closed near to bottom in a high volume. This was a very first bar after climax, which is a sign that buyers don't have power for the higher price.

c - No demand bar. The narrow spread of the bar finished in the middle. This is the final confirmation that selling looks safe.

I already secured a position on BE.

Targeting 1.1520 at least.

If you like analysis feel free to comment >

Good progress far on EUR/USD I am in plus about 60 pips or 1:2 RRR. Very simple and effective setup from today based on pure price action and volume analysis.
My final target is set at the price of 1.1470 but will watch price action and close manually if is needed. Waiting tomorrow for new opportunities.

Best Regards,
Petar

 

[Trader333]

How are you able to have accurate volume for forex pairs ?

 

[Petar Jacimovic]

How are you able to have accurate volume for forex pairs ?

Hello there,
You can use any broker to read tick volume on the Forex. The important factor is spread of the bar and also a volume on the futures market. Since I combine tick volume on Forex with futures market volume (number od shares traded) on the currency pair I observe. Basically I am doing Intermarket analysis everytime I try to find potential position.

Best Regards,
Petar

 

[Petar Jacimovic]

Good progress far on EUR/USD I am in plus about 60 pips or 1:2 RRR. Very simple and effective setup from today based on pure price action and volume analysis.
My final target is set at the price of 1.1470 but will watch price action and close manually if is needed. Waiting tomorrow for new opportunities.

Best Regards,
Petar

Closed EUR/USD position +85 pips or 1:3RRR
I am waiting for ADP Non-Farm Employment Change in a few hours to find potential new opportunities.

 

[Petar Jacimovic]

Hello traders,
I bought EUR/USD at the price of 1.1500. I found strong shakeout in an ultra high volume from the 1.1465. According to the 1H timeframe, there is wide spread bar with ultra high volume but the bar closed in the middle. This must be that buyers took control from sellers. The support cluster got confirmed, which is also another strong sign that we may expect further higher price.

Tp around 1.1610.

Best Regards,
Petar

 

[Petar Jacimovic]

News creates good opportunities for smart traders. I took today 100 pips (1:3RRR) after the Non-Farm Employment Change. Reading volume and price action smart money cant hide their actions

Best Regards,
Petar

 

[jjames69]

i think volume is over rated.

 

[Petar Jacimovic]

i think volume is over rated.

Hello James,
Volume is a vital part of professional trading. On the Forex, we got tick volume (very decent indicator to read activity) but I combine futures market volume, which is centralized. Its all about liquidity.

Most traders trying to trade any type of market but that is gambling basically. If you trade on low liquidity, you can go into market makers trap. They searching for low liquidity markets to manipulate crowd. Smart traders trade on high liquidity reading price action and volume,

Best Regards,
Petar

 

[jjames69]

Hello James,
Volume is a vital part of professional trading. On the Forex, we got tick volume (very decent indicator to read activity) but I combine futures market volume, which is centralized. Its all about liquidity.

Most traders trying to trade any type of market but that is gambling basically. If you trade on low liquidity, you can go into market makers trap. They searching for low liquidity markets to manipulate crowd. Smart traders trade on high liquidity reading price action and volume,

Best Regards,
Petar

i am basically a daytrader and trade the qqq's and e mini's. i find volume can be a lagging indicator much of the time, even on longer term charts, so i quit using it. i just key off classic patterns, with confirmation from a breadth indicator(tick), and take a quick glance at the major underlying stocks of the qqq's.

sorry, for not realizing this is the forex forum.

 

[Petar Jacimovic]

i am basically a daytrader and trade the qqq's and e mini's. i find volume can be a lagging indicator much of the time, even on longer term charts, so i quit using it. i just key off classic patterns, with confirmation from a breadth indicator(tick), and take a quick glance at the major underlying stocks of the qqq's.

sorry, for not realizing this is the forex forum.

Can't agree with you there.

The significance and importance of volume appears little understood by most non-professional traders.
Perhaps this is because there is very little information and limited teaching available on this vital part of
technical analysis. To use a chart without volume data is similar to buying an automobile without a
gasoline tank.

One thing there about indicators in general. They are all lagging because evething you see is the past and based on the pars. Volume is critical part in professional trading because it measure liquidity and activity. I trade successful for many years using pure price action and volume analysis. Patterns are fine on stock market but withtout volume they are usless, because you must watch for breakout of ctritical points and observe volume in creation of pattern to avoid invalid patterns.

I use Volume spread analysis and Wyckoff analysis in general. Once you master reading the volume, it is extremely powerful.

Best Regards,
Petar

 

[jjames69]

Can't agree with you there.

The significance and importance of volume appears little understood by most non-professional traders.
Perhaps this is because there is very little information and limited teaching available on this vital part of
technical analysis. To use a chart without volume data is similar to buying an automobile without a
gasoline tank.

One thing there about indicators in general. They are all lagging because evething you see is the past and based on the pars. Volume is critical part in professional trading because it measure liquidity and activity. I trade successful for many years using pure price action and volume analysis. Patterns are fine on stock market but withtout volume they are usless, because you must watch for breakout of ctritical points and observe volume in creation of pattern to avoid invalid patterns.

I use Volume spread analysis and Wyckoff analysis in general. Once you master reading the volume, it is extremely powerful.

Best Regards,
Petar

we'll just have to agree to disagree. i've been trading for years, and have studied thousands of chart patterns at this point.

too often the expanding volume does not come until after the breakout.

aside from some trend analysis, just give me price and a breadth indicator, particularly when daytrading, since you simply don't have time for lengthy analysis.

the last thing i want to do is overanalyze, and miss trades. i'd just soon get a few wrong, and let my winners make up for it.

on the longer term charts, i spend a little more time looking at the underlying components, ie apple, msft, sox, etc.,to find confirmation.

notice the two W bottoms below and corresponding volume at breakout. you'd have missed the boat on both.

cheers

 

[csc2009]

Hello everyone,
I opened this thread for Volume price action analysis. I am a full-time trader for more than 7 years and in my analysis, I am using volume and price action. I combine Volume spread analysis, Wyckoff analysis and pure price action to create a smart view and try to follow the smart money.

Feel free to post your opinions and forecast the market >

Happy Trading

Interesting combine those two analysis together, I would love to know more about it.

 

[malaguti]

we'll just have to agree to disagree. i've been trading for years, and have studied thousands of chart patterns at this point.

too often the expanding volume does not come until after the breakout.

aside from some trend analysis, just give me price and a breadth indicator, particularly when daytrading, since you simply don't have time for lengthy analysis.

the last thing i want to do is overanalyze, and miss trades. i'd just soon get a few wrong, and let my winners make up for it.

on the longer term charts, i spend a little more time looking at the underlying components, ie apple, msft, sox, etc.,to find confirmation.

notice the two W bottoms below and corresponding volume at breakout. you'd have missed the boat on both.

cheers

big difference between your chart and his...his are lovely examples of where it works. I look at the FTSE100 stocks and volume is completely irrelevant. Had I traded with volume, I wouldn't have traded at all
but then I'm sure he'll tell me how little I understand.
I'll say he doesn't understand the real world

 

[Petar Jacimovic]

we'll just have to agree to disagree. i've been trading for years, and have studied thousands of chart patterns at this point.

too often the expanding volume does not come until after the breakout.

aside from some trend analysis, just give me price and a breadth indicator, particularly when daytrading, since you simply don't have time for lengthy analysis.

the last thing i want to do is overanalyze, and miss trades. i'd just soon get a few wrong, and let my winners make up for it.

on the longer term charts, i spend a little more time looking at the underlying components, ie apple, msft, sox, etc.,to find confirmation.

notice the two W bottoms below and corresponding volume at breakout. you'd have missed the boat on both.

cheers

Hello there,
You didn't read post 12 where i said >
Patterns are fine on stock market but without volume they are useless, because you must watch fora breakout of critical points and observe volume in a creation of pattern to avoid invalid patterns.

Its not just about breakouts, we observe a whole pattern and volume creation there. Anyway, will post new analysis with explanations next week, now i enjoy weekend.

Petar

 

[Petar Jacimovic]

big difference between your chart and his...his are lovely examples of where it works. I look at the FTSE100 stocks and volume is completely irrelevant. Had I traded with volume, I wouldn't have traded at all
but then I'm sure he'll tell me how little I understand.
I'll say he doesn't understand the real world

Hello malaguti and walcome to thread.

Volume analysis is a big field and usually when i see that ppl. speak about volume in negative context I know that they lack proper knowledge about volume analysis.

Anyway, as I said i will post analysis with explanations in future and together we can create good discussion. For now, have a great weekend.

Best Regards,
Petar

 

[jjames69]

Hello malaguti and walcome to thread.

Volume analysis is a big field and usually when i see that ppl. speak about volume in negative context I know that they lack proper knowledge about volume analysis.

Anyway, as I said i will post analysis with explanations in future and together we can create good discussion. For now, have a great weekend.

Best Regards,
Petar

ok, always looking to expand my universe. i trade the nasdaq not forex, so i hope i'm not trying to compare apples to oranges.

cheers

 

[wallstreetwarrior87]

ok, always looking to expand my universe. i trade the nasdaq not forex, so i hope i'm not trying to compare apples to oranges.

cheers

Actually from a volume analysis POV - NQ, YM, and ES are the best to observe, as they are the most transparent in terms of real time reported activity.

I know where the OP is coming from, but yes as others have said, we can trade without volume also, but sometimes you just miss a tiny bit of information (warning sign) as to why a set up may not work. If you want to make it all part of probability, and accept it just did not work out, then that's fine, but with a bit of added information (volume) you may not take the trade even though the set up "looks" good. So it can add to your probability if you know what to look for, but it is not the only critical factor to trading.

 

[jjames69]

Actually from a volume analysis POV - NQ, YM, and ES are the best to observe, as they are the most transparent in terms of real time reported activity.

I know where the OP is coming from, but yes as others have said, we can trade without volume also, but sometimes you just miss a tiny bit of information (warning sign) as to why a set up may not work. If you want to make it all part of probability, and accept it just did not work out, then that's fine, but with a bit of added information (volume) you may not take the trade even though the set up "looks" good. So it can add to your probability if you know what to look for, but it is not the only critical factor to trading.

a. if you are trading right the capital made from one winner should offset 2-3 losers. so one must be careful not to over analyze trades and miss the boat.

b. as a daytrader, there is just not a lot of time to do in depth analysis. i try to make analysis as mechanical and steamlined as possible.

c. i have found the use of volume subjective.