Hey...what about Volume? | Page 20 | Forex Factory

Options

Go to
Permalinks
Print Thread

Similar Threads

Hey, Newbie got some questions 12 replies

Hey all 1 reply

Hey! yellow news...??? 3 replies

hey all 11 replies

Attachments: Hey...what about Volume?
Exit Attachments

Hey...what about Volume?

  • #381
  • May 4, 2018 6:44pm May 4, 2018 6:44pm
Once Again, DonPato I would like to thank you for introducing me to this method, you have revolutionized my whole trading dynamics, Once again thank you. Much Love
  • #382
  • May 4, 2018 6:59pm May 4, 2018 6:59pm
Quoting zachmodus
Once Again, DonPato I would like to thank you for introducing me to this method, you have revolutionized my whole trading dynamics, Once again thank you. Much Love
Hey Zach...I am really happy that you have found something of value here. I truly hope you are able to see the market in a better and more productive way.
@xxxx§|[::::::::::::::::>
  • #383
  • Jul 29, 2018 9:50am Jul 29, 2018 9:50am
Quoting maaRIF2015
good volume indicator no-repaint also sends buying and selling signals too goodluck {file}
Dear MaaRIF2015,

May I have the souce code file (mq4) of this thread : https://www.forexfactory.com/showthr...5#post10978115.
Because I want to set the colour and the width of the bar, also the arrow that bear down upon the bar. Thanks for kindness.
Attached File(s)
File Type: ex4 Custom Force-Volume-Divergence Indicator.ex4   13 KB | 574 downloads
  • #384
  • Jul 29, 2018 3:54pm Jul 29, 2018 3:54pm
Quoting ferry678
... Because I want to set the colour and the width of the bar, also the arrow that bear down upon the bar. Thanks for kindness.
I think you will be very disappointed in how this indicator works...and it is completely out of synch with what I am trying to present in this thread. It is a lagging indicator that repaints terribly. Thus any signal you get will be suspect until a few candles later which then defeats the purpose entirely. I would humbly suggest you really dig in and try to learn how to use the market structure to your advantage.
@xxxx§|[::::::::::::::::>
  • #385
  • Aug 10, 2018 8:30pm Aug 10, 2018 8:30pm
.
Without VSA, you're playing checkers while the Smart Money plays chess.
  • #386
  • Aug 10, 2018 10:26pm Aug 10, 2018 10:26pm
Quoting HiddenGap
.
??
@xxxx§|[::::::::::::::::>
  • #387
  • Aug 13, 2018 12:34pm Aug 13, 2018 12:34pm
Quoting DonPato
{quote} ??
"." = Thread bump.

When elephants walk across your lawn, they leave footprints. So any thread discussing volume (activity) deserves to be on the first page. Worst case scenario-the truth remains a secret without being buried.
Without VSA, you're playing checkers while the Smart Money plays chess.
  • #388
  • Aug 13, 2018 2:05pm Aug 13, 2018 2:05pm
Quoting HiddenGap
{quote} "." = Thread bump. When elephants walk across your lawn, they leave footprints. So any thread discussing volume (activity) deserves to be on the first page. Worst case scenario-the truth remains a secret without being buried.
OK...I understand...hey thanks!!

apparently interest in this thread and died off. I remain unable to clearly explain my thoughts about volume and its interaction with order flow. I am unsure if I am just boring or if many who read this thread simply don't think it worth their time.

I continue to monitor for comments or questions.
@xxxx§|[::::::::::::::::>
  • #389
  • Aug 13, 2018 8:42pm Aug 13, 2018 8:42pm
Quoting DonPato
{quote} OK...I understand...hey thanks!! apparently interest in this thread and died off. I remain unable to clearly explain my thoughts about volume and its interaction with order flow. I am unsure if I am just boring or if many who read this thread simply don't think it worth their time. I continue to monitor for comments or questions.
Interest in this thread didn't die off. I've been following this thread and lurking. Your approach basically is combining analysis of ultra high volume bar with your approximation of delta volume to predict market turning point. I've been thinking about one thing: while your approach works reasonably well, some other market turning points don't come with ultra high volume, how can we predict those (after the bar for a swing high/low is formed, we know it's a swing high/low and a market turning point) ?
  • #390
  • Aug 14, 2018 12:48pm Aug 14, 2018 12:48pm
Quoting pooh123
...some other market turning points don't come with ultra high volume, how can we predict those (after the bar for a swing high/low is formed, we know it's a swing high/low and a market turning point)
I have been making observations on this same issue as well. Low volume environments are extremely unpredictable...meaning price can move large distances (in pips) on low or thin volume, or it can go nowhere...The formation of a swing point in this environment is "suspect" from my way of thinking. I think this way because low volume literally means "no interest" in the instrument. Also low volume environments also produce ranges, which by their very nature, are areas of balanced order flow and uncertainty of direction.

I have noticed these usually occur AFTER a volume climax has occurred, or during periods of little interest in markets (like now during the vacation season in Europe).

How do we "predict" these areas? I don't know that you can. What usually ends up happening is that you simply get "stuck" in one. Price oscillates due to lack of volume or turns quickly against you because there is no intervening order flow. In these situations you usually see the majority of participants stopped out and therefore driving the price against themselves. What do I mean by that?

Lets supposed you enter a buy position with a stop (where ever you place that stop)...Now you are done!!! Price will only move higher if other participants also place buy orders...in fact more buying volume than there is selling volume. So if there is very little buying volume (due to lack of interest) any selling, however slight will push price down further, until your stop is hit. Now multiply that by the entire global market...people's stops tend to cluster in areas that when hit will create a sudden influx of (in this case) selling driving prices further down...against your position...thus the buyer's stops are what are actually driving the market farther down.

This will then cause new sellers to enter, which (due to lack of volume) will create same only opposite situation, and the seller's stops will cause an unexpected rise in price...

And thus it goes...no commitment on either side to carry through with any price movement and thus a range or "blah" market. I can think of nothing that will predict this, except perhaps the season...ie August..."the summer doldrums". You will also see this environment about 24 hrs before a major news announcement when participants stay out of the market until the new is announced.

I continue looking at this with an objective eye, but I've found that the larger volume set up you mentioned is far more successful and easier to see coming.
@xxxx§|[::::::::::::::::>
  • #391
  • Aug 16, 2018 5:23pm Aug 16, 2018 5:23pm
Quoting pooh123
{quote} Interest in this thread didn't die off. I've been following this thread and lurking. Your approach basically is combining analysis of ultra high volume bar with your approximation of delta volume to predict market turning point. I've been thinking about one thing: while your approach works reasonably well, some other market turning points don't come with ultra high volume, how can we predict those (after the bar for a swing high/low is formed, we know it's a swing high/low and a market turning point) ?
There are different types of turning points , the ultra high vol turns are typically exhaustive moves. A head and shoulders type reversal would turn on less volume but you would see and need to see vol increases in the right places to confirm as volume is your gauge for professional activity of whom you need to be on the same side as.

Also knowing where price has come from (context) can help you with future turning points. Price maybe in a correctional phase and so the turn to resume trend at the end of the correction wouldn't be on high volume.
Never said I was Batman,all I'm saying is you'll never see us together.
  • #392
  • Nov 9, 2018 8:11am Nov 9, 2018 8:11am
Quoting DonPato
{quote} I have been making observations on this same issue as well. Low volume environments are extremely unpredictable...meaning price can move large distances (in pips) on low or thin volume, or it can go nowhere...The formation of a swing point in this environment is "suspect" from my way of thinking. I think this way because low volume literally means "no interest" in the instrument. Also low volume environments also produce ranges, which by their very nature, are areas of balanced order flow and uncertainty of direction. I have noticed these...
Hey Don, interesting thread thank you kindly for posting, may I ask you please if you managed to find a delta volume indicator which was usable in regards to reading the delta volume for climax, exhaustion and absorption? I normally use just stand alone tick volume for this but would be interested to 'dig deeper down into the rabbit hole' to fine tune my entries a little, I find myself drawn to delta volume...thanks again for any pointers!
  • #393
  • Nov 9, 2018 10:07am Nov 9, 2018 10:07am
Quoting vwap
{quote} Hey Don, interesting thread thank you kindly for posting, may I ask you please if you managed to find a delta volume indicator which was usable in regards to reading the delta volume for climax, exhaustion and absorption? I normally use just stand alone tick volume for this but would be interested to 'dig deeper down into the rabbit hole' to fine tune my entries a little, I find myself drawn to delta volume...thanks again for any pointers!
Hello vwap...and welcome. It has been a long time since anyone posted here...

To answer your question I wrote my own indicator for my FX trading and had it coded for cTrader. But there was someone on this thread that also posted an indicator that is very close to what I coded in post #210.

While Climax and Absoprtion seem fairly straight forward "exhaustion" has proven a bit more illusive because of its difficult to define nature (at least in terms of coding).

I have also found that finding the "right" turning point really comes in as a matter of watching multiple time frames and coordinating those phases with the lower time frame. I use larger time frames so when I see the weekly pass through the climax and exhaustion phases and am looking for the final absorption phase...then I look to find those three phases "burried" inside the final absorption on the smaller day time frame.

Hope that helps
@xxxx§|[::::::::::::::::>
  • #394
  • Nov 9, 2018 10:34pm Nov 9, 2018 10:34pm
What is the best time frame for this kind of strategy?
Does it work better on longer time frames?
  • #395
  • Nov 10, 2018 8:56pm Nov 10, 2018 8:56pm
Quoting trovoltino
What is the best time frame for this kind of strategy? Does it work better on longer time frames?
Please excuse me for getting a bit "picky" but I believe how we think of things greatly effects how we act...what I've tried to present here is not a strategy. It is simply a methodology to identify when and how swing (turning points) in the market occur. Some of those swing points actually result in reversals...some do not. However if you are wanting to trade (either trends or reversals) you will need to understand how and why these swing points occur.

Of course as the name of this thread implies, I am studying specifically how volume can be used to our advantage. Of course true volume is one of the major structural elements of any market but here in the FX market we have no access to "true" volume data and are thus only left with tick volume, which is only a "transaction counter" and nothing more. It does not indicate the size of those transactions.

So now to answer your question...there is no specific time frame that works "best". Indeed I use this methodology on extremely small tick charts in the futures market every day. However the futures market gives you "true" volume data where the FX market does not. In addition, the futures market has a specific session during which all trading comes across the central exchange, whereas the FX market is spread out over 3 major sessions over a 24 hr trading day.

In each session the volume waxes and wanes as the banking sector in each part of the world comes online and then offline again. Clearly this will create volume measurements that can be extremely low (during gap times between sessions) and extremely high (when two or more markets are open and active). Thus my methodology can cause "false" signals between sessions, especially if you are trading 15 min - 4 hr (or greater) intraday charts.

It is with this in mind that I recommend using this methodology with a minimum of daily chart candles. This is because the day is complete and you don't get the "gaps" in data. So I use daily/weekly/monthly charts.

Of course this only scratches the surface of this methodology. There are also data management issues to address. This is because the FX market data is decentralized, meaning that the data you receive on your retail broker's platform come from (or is an amalgam of) your broker's liquidity providers. Again there is NO central repository for this data and even if there were it would only be tick data not volume data.

This forces us to use a bit of "extrapolation" and intuition in our FX trading...more so than in other centralized and regulated markets. So again...This methodology works on ALL time frames but is especially challenged in the FX market for some of the reasons I have mentioned above. That doesn't mean it still isn't THE most accurate way I've found to trade. It only means that we have to view this information in the appropriate context which, if you read any of my posts, you will understand...CONTEXT IS EVERYTHING.

I hope this helps
@xxxx§|[::::::::::::::::>
  • #396
  • Nov 12, 2018 5:47am Nov 12, 2018 5:47am
Do you think there could be a good way to backtest "volume" if I have a capability to do so? And if yes, what parameters would you test for?
Thanks!
  • #397
  • Nov 13, 2018 8:35am Nov 13, 2018 8:35am
Quoting trovoltino
Do you think there could be a good way to backtest "volume" if I have a capability to do so? And if yes, what parameters would you test for? Thanks!
Sorry for the delay...I'm at the Trader's Expo in Las Vegas...

To answer your question...I'm not quite sure what you mean by "backtest volume". You can go back in time with your charts and observe the volume along with the price...yes. As to the "parameters"? Are you wanting something to code? As I am not a coder I wouldn't know what to tell you. My trading is completely discretionary and as I mentioned in my previous post, I don't believe the order flow and tick volume parameters would lend itself very well to a coding project...I could be wrong.

Perhaps you can be a bit more specific regarding what parameters you would be looking for. Mostly all I can give you are "definitions"...what is a climax bar...what is an absorption bar...etc.
@xxxx§|[::::::::::::::::>
  • #398
  • Nov 14, 2018 11:18am Nov 14, 2018 11:18am
No thats fine.
Yes, I have a soft, that is capable of very detailed back testing(not mt4 but it uses same tick data) and analysis, I have tested a lot of indicators, simple strategies, more complex strategies that I wrote myself.
But I have very limited knowledge of markets and I was lucky enough to find one strategy that worked on binary brokers extremely well, but forex is different ball game and i cant seem to find strategy that shows any results...
Thats why I wanted to know, is there a way I can back test "volume", as I see it might be beneficial.
If I get an idea how to test it, I will post results here!
  • #399
  • Nov 14, 2018 2:40pm Nov 14, 2018 2:40pm
Quoting trovoltino
... If I get an idea how to test it, I will post results here!
Good luck!!
@xxxx§|[::::::::::::::::>
  • #400
  • Nov 14, 2018 8:44pm Nov 14, 2018 8:44pm
Quoting DonPato
{quote} Hello vwap...and welcome. It has been a long time since anyone posted here... To answer your question I wrote my own indicator for my FX trading and had it coded for cTrader. But there was someone on this thread that also posted an indicator that is very close to what I coded in post #210. While Climax and Absoprtion seem fairly straight forward "exhaustion" has proven a bit more illusive because of its difficult to define nature (at least in terms of coding)....
Hey Don, thank you kindly for your helpful reply, also thanks for the insight into how you utilise the multiple time frames and co-ordinate those with the lower time frame charts, that makes very good sense indeed. It will be interesting to see how these phases of the market play out in the smaller time frames based on the higher time frames larger ‘phase at work’. Interesting logic and ‘order out of chaos’, btw thanks also for pointing to the TicksSeparateVolume indicator post by Darryl, looking forward to seeing this data, this is probably the third time I have revisited deltavolume, originally it was footprint based visual data, since then the delta has piqued my curiosity! Thanks again Don, will report back my findings, keep up the good work!
0 traders viewing now