Recognising Volume - opportunity or trap?
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WaveSurfer
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Too late to post my view on your first chart tech, I would have bought on the most recent bar though, with a stop below the previous test bar.
As for determining if high volume up bars are bullish/bearish. I tend to draw in a line on the close of that bar and use that as my reference point. Below it with increased selling and I'll short any no demands. Above it with increased buying and I'll buy any test or shakeout. Works really well on futs 1m chart.
Not a bad day on the SPI today, I had to wait for my set-up cause I missed the first few hours. But this came along and I was looking for some quick points on longs for sure.
Two bars on big volume, I marked each bar's close and that was my reference point. Immediate hidden test 2 bars later after buying on the previous bar. I was in on the break of the test's high (4764) stop 1 tick below the test (4759).
Added to position (4764) on the dip back into my zone on much lower volume. Stop moved up 1 tick.
Position exited at the top of my channel 4772 after the break above it died in volume.
If I were still trading today, I'd be buying any strength back into that zone. My bullish view would change pretty quick if we see weakness under it. It is a down day, not going to get too cocky.
As for determining if high volume up bars are bullish/bearish. I tend to draw in a line on the close of that bar and use that as my reference point. Below it with increased selling and I'll short any no demands. Above it with increased buying and I'll buy any test or shakeout. Works really well on futs 1m chart.
Not a bad day on the SPI today, I had to wait for my set-up cause I missed the first few hours. But this came along and I was looking for some quick points on longs for sure.
Two bars on big volume, I marked each bar's close and that was my reference point. Immediate hidden test 2 bars later after buying on the previous bar. I was in on the break of the test's high (4764) stop 1 tick below the test (4759).
Added to position (4764) on the dip back into my zone on much lower volume. Stop moved up 1 tick.
Position exited at the top of my channel 4772 after the break above it died in volume.
If I were still trading today, I'd be buying any strength back into that zone. My bullish view would change pretty quick if we see weakness under it. It is a down day, not going to get too cocky.
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tech/a
No Ordinary Duck
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If there is one thing I like to see its practical application of analysis.
Thanks a great hint---like it..
WaveSurfer
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No problems mate, I have you to thank for it anyway. The idea came from your high volume zones that you wrote about in another thread.
Here's a stock I've been watching (ROC), and a good example of when the closes of the high volume bars form a range and I'll wait for the range to break.
Massive wide spread down on huge volume. Price has churned right on the close (red line) for over a year now. Every other high volume bar thereafter you'll notice the close of the bar is near the close of the bar I have marked with the red line, the others I have marked in blue. I drew these three lines in July last year.
Looks ripe for a big move, let's hope it's up cause there's much more room than down
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